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California's Revised Pay-As-You-Drive Insurance Draws Continued Objections
The EFF has restated many of their original privacy objections about California's latest revision to the Pay-As-You-Drive auto insurance proposal. Admitting that the amended bill is an improvement, privacy advocates are still uneasy about the surveillance implications of this program. "The proposal centers on a simple idea: infrequent drivers are less of an insurance risk. By pricing policies according to the mileage driven, insurance companies can offer discounts to lower-risk infrequent drivers, and put an appropriate cost penalty on heavy drivers. The state estimates that 30% adoption of PAYD insurance nationwide would reduce miles driven by at least 10% among subscribers, and save 55 million tons of CO2 over the next ten years. The benefits of such a system could be quite dramatic, as California Insurance Commissioner Steve Poizner is sure to emphasize. Such insurance plans first became available in 2004, and are now available as a limited option in 30 US states from insurance companies like Progressive and Liberty Mutual."
How is someone who drives less better at driving? It would seem someone who drives less frequently is less practiced and would be a greater risk as compared to someone who is a regular driver. There must be some sort of bell curve where the people on the ends pay more.
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Why would anyone think that paying by the mile would reduce the amount I'm driving?
I don't go on long jaunts around the town just for the hell of it, I go because I need to get somewhere, or pick something up.
So pretty much what this would do is either be a savings for me--because it'd be less than my buffet style policy--or it'd be more expensive for me. I'm guessing that the majority of people, myself included, would fall into the latter category.
I currently have no clever signature witicism to add here.
just don't know how it can save "55 million tons of CO2 a year"....people who drive a little will continue to drive a little with this insurance or not.
I hate it when they fudge numbers and try to draw a causation out of it.
A chicken didn't lay an egg because there was a law passed that gave tax incentives to the chickens to lay eggs....
I hate it even more when politicians take credit for something that has nothing to do with anything.
I don't drive very often, but when I do drive, I always have a case of Dos Equis with me.
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but it lacks any practicality fo California.
All this will do is make insurance unaffordable to low income families that have toi drive due to the distance they must commute. Meaning more uninsured motorists.
They al ready take it into account some what, and that's enough.
This is just attempt to squeeze another dime out of people who must have this service.
Quite frankly, if the Government is going to mandate insurance, then it should also offer a base insurance program, at cost.
Just one that covers the minimum insurance levels. If you want more, then you can buy more from an insurance company.
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I'd always thought it would be a neat idea to roll auto insurance in at the gas pump. No more uninsured drivers, plus it would be an incentive to reduce driving. obviously LOTS of holes in the plan, but it would eliminate the big brother aspect of this proposal.
Insurance companies already charge more if you drive more; all of them that I know of ask how much you drive. I actually started to RTFA, but there's little to no explanation of what the "pay as you go" does, and as I don't live in California it's not likely to affect me unless it's adopted by other states.
Can anybody clarify for me?
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Sunday drivers have got to be the most dangerous people on the road.
Someone who drives 100K miles a year is going to have a lot more miles between accidents than someone who does 5K.
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I dunno about others, but all of a sudden, I'd have an incentive to find the shortest router from point A to point B, even if that means city-streets instead of expressway. This means I'll be sitting in heavy traffic, clogging up the streets, taking longer to reach my destination, and probably causing more accidents and safety issues.
WTF? Am I missing something? Last time I got insurance for a vehicle (in California!), the guy writing the policy asked me how many miles I expect to drive per year. They have a number of mileage brackets that are used in the calculation of your premium. The more miles you drive in a year, the more money you pay. Back in the before time, I had a classic car that was a weekend ride. Insurance was cheap because it was classified as "pleasure use" and driven less than a thousand miles per year. I don't think I've ever had a situation where the estimated annual mileage wasn't used to calculate the premium.
Lucky you. Back when I had a long commute -- despite the fact that I took mass transit to my office (with a two-mile drive to the train station) my insurance company assumed I drove to my office each day. I provided train receipts, pictures of my odometer, etc... I offered to have their agent inspect my odometer in person... but to no avail. They based their rates on a 120-mile round trip despite the fact that I drove four miles daily.
I eventually switched insurance carriers, but I overpaid on my insurance for six months because those douchebags couldn't grok the idea that someone might take mass transit even when they own a car.
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I agree. Odometer checks seem far less invasive, and cheaper, than GPS. Also, already illegal to tamper with, while I can think of all sorts of ways to interfere with GPS tracking.
Cost them money? Not likely. Mark my words, they'll charge people that drive less the same that they pay now, and charge people that drive the most even more.
This driving close to home bit sounds dangerous!
MyRate by Progressive (as mentioned in the summary) has been around for quite some time (in select states) and I am a longtime customer. Here is how it works:
You get a computer chip that installs on the ODBCII port on your computer. Every 6 months (when you renu your policy), you pull out the chip, plug it into your computer via USB, and upload the data with your policy renewal request. You can view charts of your driving speeds, times, etc.
Progressive then offers you a discount percentage off of your base premium. They have an explicit policy that utilizing this chip cannot INCREASE your premium, only give you the option of a discount (in other words, we overprice our policy, but give you an option to recoup it if you drive less)
The discounts are as follows:
5% = participation discount
5% = safety discount (stay below 75mph and the discount is yours)
up to 10% = based on driving time / milage.
The 10% is calculated roughly as such.
At the beginning of the tracking period, you are given a 10% discount. then for every mile you drive, that percentage is reduced by a fraction. That fraction (something around 0.0006% per mile) is determined based on the time classification you drive. they have 3 classifications of driving time, low, medium, & high. High are times such as rush hour, and overnight, medium are weekends & lunch hour, low is everything else.
Ultimately, with both the safety discount and the amount I drive, I end up with somewhere around a 16% discount off my policy renewal.
It can be compared to the california policy, but in reality the current offered program seems quite different from the proposal.
The premise is faulty. Open highway driving is far safer than inner-city rush hour traffic.
You need to consider the conditions, not just the distance.
-Jeff
Please learn the difference between a dissenting opinion and a troll before you moderate.
I've combed through the 108 comments so far that have been modded 2 or above, and not a single one of them shows any awareness of what the article actually talks about. Has anybody actually read the article? Oh, wait, this is slashdot...
The article helpfully explains that the main issue being raised by the EFF is privacy. Um, it's not exactly subtle...the article has a big image of a poster with a man's face, with the slogan "BIG BROTHER IS WATCHING YOU."
What the EFF is objecting to is the idea of using electronic monitoring to measure the number of miles driven. The article (remember that article thingie? it's got that little underlining thingie, with the text in a different color, so you can click on it, and it's, like, a hyperlink, so you can go and read it?) lays out some objections to this, such as the tendency the government has demonstrated since 9/11 to go nuts with intrusive monitoring of its citizens. The concern is that the government will then be able to tell where every citizen drives. That's pretty darn scary, if you think about it.
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It's good to see that California isn't letting their impending bankruptcy hold back their socialist agenda.
I lived in LA for 6 years. California is probably one of the worst places to try to implement this program as: (1) they have a massive amount of urban sprawl, (2) Los Angeles has incredibly inefficient public transportation, (3) and there are broad swaths of the state where driving is almost a necessity for people who can't afford to live in the communities that they work in.
Is this really such a problem that is needs to be addressed right now? As others have said, there are going to be no deals here. Insurance companies will make sure that they profit over this little experiment. Furthermore, the state officials may mean well, but the federal government has shown that they will not hesitate to violate our privacy. Why give them another mechanism to do so?
But what really puts the cherry on the cake are the little comments that this will reduce CO2 emissions. Newsflash: Most people don't drive more than they need to, and the ones that drive for fun are just going to pay the tax and keep driving. Why does every method for reducing CO2 emissions have to involve punishing people while giving money to industry for absolutely no innovation? Do you think I like sitting in traffic with 3 other carpoolers? Build some efficient public transportation that actually works and people will take it. Reduce urban sprawl by not allowing people to build homes anywhere they feel like. Those are the techniques to reduce driving. Look at NY city. Look at all of Europe.