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Why Letting Your Insurance Company Monitor How You Drive Can Be a Good Thing
Hugh Pickens DOT Com writes "Kim Gittleson reports at BBC that car insurance firms like Progressive are trying to convince consumers that letting them monitor their driving behavior is actually a good thing. They say that the future of car insurance is not just being able to monitor individual drivers to give them lower prices, but also to make them better drivers. 'Now that we can observe directly how people drive, we think this will change the way insurance works,' says Dave Pratt, who says that Progressive has more than a trillion seconds of driving data from 1.6 million customers. '18-year-old guys pay a lot for insurance, but some 18-year-olds are really safe drivers and they deserve a better deal.' Better big data technologies, like the telematic driving data collected by car companies (PDF) or even information gathered from social media profiles, can help augment that risk profile. 'If I'm a driver that doesn't drive that frequently, and I have a pattern that would indicate that I drive more carefully than an average person with my profile, then I may be able to save 30-40% on my car insurance, and that's pretty significant,' says Joe Reifel. For now, using big data analytics for insurers is still in the early stages. Only 2% of the U.S. car insurance market offers an insurance product based on monitoring driving, but that proportion is projected to grow to around 10-15% of the market by 2017. And other countries, like Italy and the U.K., are already using the data to analyze not just risk profiles but also to determine who is at fault in car accidents. The future, most analysts agree is create a continuous feedback loop between insurers and consumers, so that consumers will react to the big data analyses that insurers perform and change their behavior accordingly. 'Bad drivers will at some point need to improve their driving or accept [having] to pay for the real risk they represent,' says Jacques Amselem."
> They say that the future of car insurance is not just being able to monitor individual drivers to give them lower prices
So look, I've got this bridge I've been trying to sell...
...is who decides what is safe driving?
Requiem for the American Dream
Never mind they'll see you regularly drive 10-15 over the limit and think you're a risk. How about those clowns who sit in the left lane, going up hill and don't maintain speed, so everyone jockeys to get around them in the right lane(s)? You don't see that in their data stream.
Lots more examples, which I predict this thread will include.
A feeling of having made the same mistake before: Deja Foobar
Progressive has more than a trillion seconds of driving data from 1.6 million customers.
Using a gigantic amount of very small units tends to make the whole thing meaningless. In more meaningful terms, Progressive has about 174 hours of data per customer.
Everything is better with chainsaws.
Insurance rates (and prices in general) as set according to market statistics. I don't see how monitoring individual people will help those people.
Too much potential for individual people to get screwed, with no real benefit to the public as a whole. Forget it.
then you have nothing to fear, Citizen.
While I agree you're within your rights to let them track you for the associated discount, the premise behind this and the assumed acceptance by the privacy-less Generation is disturbing.
I want to delete my account but Slashdot doesn't allow it.
Without analytics, low-risk 18 year olds pay a lot of money to cover high-risk 18 year olds. With analytics, low-risk 18 year olds pay less (though not nearly as low as they should be paying) and high-risk 18 year olds are uninsurable. Why? Because you're going to have to substantially raise the price on those high-risk 18 year olds now that low-risk ones aren't covering the bill.
Now extend this logic to health care. Why is it okay to preach universal health-care and group insurance where low-risk cover the bill for high-risk, but the same isn't true for auto insurance? It's a slippery slope!
What are the parameters that define a "good" driver. Going below the speed limit on a highway in the left lane. Being lucky when you don't look right or left making a turn onto a street? Taking way to long to brake?
I've been driving for decades, I've put over 300,000 miles under me, but I bet those damn things would label me a bad driver for I accelerate firmly coming onto a highway, I don't brake forever coming off a highway, I tend to exceed the posted speed limit by a few miles when in the left lane and certainly when passing and i do my best to maintain situational awareness when behind the wheel.
These devices will do nothing to bring about "safe" driving because that term is still relative to skill, conditions, and environment. Flo can take her device and shove it somewhere dark, just not in my car.
Life is a great ride, the vehicle doesn't matter
I live 2 miles up an unmaintained private logging road. An accelerometer would go nuts on all the bumps and make it look like I'm driving terribly, when in reality I'm creeping over holes, ruts and rocks at 5mph, in middle of nowhere, with nothing to hit except a moose.
Yeah... NFW am I getting this.
I don;t care what you heard. I don;t care what your independent-insurance-agent-father told you. I don;t care what any insurance industry flak says. I don;t care what the industry advertisements and propaganda say.
Insurance companies are NOT interested in reducing premiums. EVER!
If you hear it, it's a lie. Lowered car insurance premiums is a lie.Lowered health insurance premiums(ACA) is a lie.
If you don't know this, you are a fool!
How can cutting the premiums of safe drivers work in practice? Isn't the idea of insurance that the premiums of those who don't file claims is what pays for the claims of others? If they cut all the premiums of the safe drivers, where is the money for the claims of the unsafe going to come from? My guesses: they are not paying out many claims since they just drop unsafe drivers, or perhaps they will simply recoup the money by raising the premiums of any driver who files a claim. In the latter case at least, your 'insurance' is perhaps no more useful than a credit card.
This posting is provided 'AS IS' without warranty of any kind, implied or otherwise.
Assuming their telemetry system is limited and that "safe = slow = low prices". That isn't always the case!! Slow may very well = dangerous in many occurrences.
Too true. I have a pretty long commute every day and have regularly seen people putting on Make Up, phoning, having animated discussions (lots of hand gestures, sudden jerks of the vehicle back to the middle of the lane after hitting some bot dots*, the driver who suddenly doesn't want to be passed - speeding up to prevent you changing lanes, etc.
*plastic dots aside lanes or road shoulder which are often reflective, which result in a BUDDUMP-BUDDUMP-BUDDUMP when your wheel goes over them. Common in places where regular road plowing doesn't take place.
A feeling of having made the same mistake before: Deja Foobar
we think this will change the way insurance works,
So if they find I'm a good driver, never getting in any accidents, maintain a good distance between myself and other vehicles, don't get any tickets, they'll give me a huge discount, at least 50%, from what I'm paying now, right?
*crickets*
Insurance company: We're sorry, we don't operate that way.
Me: Yeah, thought so. Just another scam to hand over my money to a private company.
We will bankrupt ourselves in the vain search for absolute security. -- Dwight D. Eisenhower
The health insurance industry did this about twenty years ago (ish. I don't remember exactly). Instead of binning people by risk and associated cost, they starting looking at people on an individual level and simply denying those who might not be profitable. It sounds good when you're angry at irresponsible drivers, and it certainly makes money for the insurance companies, but it doesn't work when you're dependent on cars on driving to make your infrastructure work and when insurance is an integral part of that (required in many states).
But what makes me a "safer driver" I've been in two accidents in my 26 years of driving. Rear ended once at a traffic light, and the other one the guy spun out across four lanes of traffic to slam into my truck, after I'd had time to come to a complete stop. And I haven't had a speeding ticket in over a decade. But I still have a lead foot, and tend to drive above the speed limit. Would I qualify as a "Safe Driver"? I have a car chip and monitor my vehicle for performance and maintenance issues, it lets me see the kind of data they would collect: average speed, highest speeds, acceleration profiles (rabbit starts, something I try to resist for fuel efficiency reasons but often realize I've done after the fact) hard breaking events etc. . .
Okay maybe for an 18 year old male to maybe get a lower rate. But otherwise, hell no.
My safe driving status should be based on what really makes for safe driving, and they haven't yet made the ODBII compliant device that monitors how alert and aware I am of the traffic around me. Of how often I check my mirrors and blind spots, of how I look ahead to anticipate problematic intersections or road conditions. Until they can monitor those, they can't really monitor safety. Speed is not a safety factor. Hard breaking may be, but it's still missing a ton of variables that explain the cause. Any insurance co that asks for this is losing a customer. I have a monitor on my vehicle already, but for my personal use and only my use.
I'm too lazy to compose a creative sig.
When ever someone offers you the opportunity for lower rates by providing more information, what they are really offering is the opportunity to either eliminate you from their liability pool or raise your rates. Insurance is, in an efficient market like auto insurance, a zero sum game. Those whose rates get lowered must be offset by those with higher rates unless the overall claims volume is reduced.
Bad drivers already are in a feedback loop from their insurers. Anyone who has received a moving violation or been in an accident feels the pressure of insurance premiums. It's the only reason I get concerned about a speeding ticket - $150 for getting caught doing 12-15mph over on the freeway is annoying; having my premiums go up $400/year for 2 or more years is far more punishment than the courts are doling out.
Is it just my observation, or are there way too many stupid people in the world?
So basically, even though many studies have shown speeding alone is mostly not a cause of car accidents, as long I stick below the speed limit, the insurance companies will reward me for being a good driver, regardless of how many people I cut off, how many lanes I swerve between lanes, how little I use my turn signals, or how much I update my facebook status and generally piss off other people while driving, not to mention how drunk or high I am while doing so.
Great idea there guys.
and the devices are temporary.
The wife and I currently use Progressive and we did their little driver-monitoring program a year or so ago. Our vehicles were only monitored for a couple months.
We ended up saving some money (Progressive was already lower than all the competition we had scoped out, but the program made it even a little lower).
Of note were the reasons given:
1. The devices were able to confirm our relatively low miles-driven.
2. The devices found that we drove during "safe" times of day (if I remember right, it's the wee hours of the morning that are the "unsafe" times, probably due to increased rates of drunk driving).
3. My wife saved a little more than me, due to my slightly higher incidences of "rapid stops." Apparently I should've punched through those yellow lights to save time AND money.
Insurance isn't supposed to be about profit, it's supposed to be about cost-management. Say that for every 1,500 people, one of them will be in a car accident each year. The average cost of a car accident in terms of legal costs, replacement, etc., we'll say is $50,000 -- or about $136.98 per day. Let's add a 15% administrative cost -- that is, the cost to hire people and collect the funds. That's $157.53 -- Now divide that by 1500 and multiply it by 30.5 (the average length of a month) you get $3.20 per month per person.
And that's how insurance is supposed to work: Distribute the costs so that the one poor bastard that would otherwise be broke, bankrupt, and his life ruined, avoids that fate because the risk is distributed over a large number of people. The administrators take home a reasonable profit -- that is their salaries plus maybe 5%, which is about average profit for a successful business, and you call it a day. Then you only need to manage the edge cases -- that 1% that gets in lots of accidents for no apparent reason. And those should be pretty easy to detect... since, you know, they're getting in accidents a lot. Set a threshold beyond which it's statistically improbable it could be random chance just kicking one guy's ass, and you're all set.
There is no need for any of the rest of this. The reason they put it in, is the same reason our health care went to absolute and total shit: They're determining risk based on the individual, not the group, and maximizing profit. That is, insurance today has become about avoiding risk, not absorbing it.
#fuckbeta #iamslashdot #dicemustdie
That's not how it works, actually. Progressive's Snapshot discount doesn't take speed into account at all.
The three things they look at are:
1) How often you drive (miles)
2) What time of day you drive
3) Number of hard stops
I noticed that driving with a Snapshot for 6 months I became a lot more careful of hard stops. I gave other cars more space and drove much more defensively, even though I'm a very defensive driver already.
I think it's safe to assume that an insurance company is interested in metrics that actually correlate well to safe driving, since their business literally depends on it. They want to give the discounts to people who are actually less likely to get into accidents.
Progressive isn't the government. They don't want to just look like they're doing something about a problem. Their bottom line actually depends on it.
"You now have one point remaining on your license."
Someone I know has a Progressive monitor plugged into her ODB-II port. It beeps to "berate" her when she is driving "badly".
Apparently slowing down to stop at a red light is driving badly.
Also, slowing down quickly to avoid an accident is also driving badly.
She wants to throw it out the window, because the only time it ever "complains" is when she either stopped at a red light, or avoided crashing into someone who cut her off.
If insurance companies want drivers to use these things, they really have to come up with a better definition for "bad driving" than "slowing down quickly".
OK. Enough of the FUD; I use Progressive and I got the 30% discount.
I drive, on average, 10-15 MPH above the posted speed limit. But I leave - minimally - 2 seconds of stopping time in front of me. I'm more likely to merge going 65mph in a 60mph than 55mph, unlike many other drivers - it vastly helps traffic flow when you merge going at the same ambient speed as other drivers. Definitely not a leadfoot. Just observant.
They track when you drive, and number of "hard" stops. I had the beeper go off ONCE - when I was cut off by a driver. People will have sudden stops - deer crossings, other drivers. One or two isn't an automatic penalty. I was with another driver, and he had THREE "beeps" while stopping. Reason is he tailgates during normal driving. If the car in front slams on the brakes, he does too. It just measures the delta D over delta T, and if the ratio is too large, it determines it was a "hard stop". Like I said - you are allotted a certain number of these based on normal driving procedures.
The other part of the discount comes from when you drive - I had a second job during second shift, and drove back during the "cautionary" zone more nearly 3 times a week. I still got full discount.
Before everybody goes SCREAMING about how they're getting reamed a new asshole because Insurance Company X will know if they've gone 1.5 mph over the posted limit, settle the fuck down.
How about this? What about a sensor in front of the car, measuring current speed and distance to car in front? If you spend 0-5% of the time within 2 second stopping distance, you get 0 discount; all the way up to 90-100% of the time getting a (max) discount. That's about what the Snapshot was measuring. Jesus Christ the sky is falling!!!
Relevant link from Progressive
The hard brake (defined by them as deceleration of >=7 mph/sec) is the metric they care the most about. I logged only four of them in my six month evaluation period and received the full 30% discount in spite of a daily mileage average of 61 miles, back when they supposedly wanted to see an average of <=30 miles/day.
A large number of hard brakes would seem to suggest a driver who is frequently distracted. An attentive and defensive driver should be able to avoid the majority of them, even in traffic and even when other drivers do something stupid. There are a few occasions that will be unavoidable but they're the exception, not the rule. Only one of mine was unavoidable (deer ran in front of me), the rest were caused by my own failures.
I want peace on earth and goodwill toward man.
We are the United States Government! We don't do that sort of thing.
Obviously they are interested in lowering premiums, just as long as they can maintain their profit. Lower premiums attract more customers, improve customer satisfaction.
The way they want to reduce premiums is by reducing risk. That way they can keep profit levels the same.
const int one = 65536; (Silvermoon, Texture.cs)
SJW, n: "Someone I don't like, and by the way I'm a fuckwit" - AC
So, I'm cruising along the highway at normal/safe/legal highway speeds. There's an on-ramp just ahead, with a car about to merge onto the high-speed roadway.
The merging driver should be going the full speed of the roadway. But he isn't. Because he's not actually a good driver. Instead, he's still travelling at on-ramp speed -- 20% below the highway limit, not at merging speed.
The safest thing for me to do is to accellerate much faster to get past the merge area before he gets to it. I have the room in-front of me, not behind me. The surface is safe, the visibility is safe, my car is safe and capable, and I'm very alert. So I accellerate to 30% over the limit for the 4 seconds it'll take.
You show me the insurance company that notices my excessive speeding as the safe driver and the slower merging car as the unsafe driver. I sped, to a speed that on paper is dangerous, illegal, and inappropriate. I just avoided a potential high-speed collision -- likely between the merging car and a third car behind me who couldn't see anything.
Had police unwittingly pulled me over, I'd have appeared before a judge, plead "guilty with a reason", and the judge would have agreed. Meanwhile, my insurance company would have done what, exactly? Would they have even asked me why I was speeding?
Rapid acceleration wastes fuel.
scale out a bit and you'll see it's really 'no sovereignty over your life.' This thing with car 'insurance' is just one piece of it..
...this is nothing more than a leftist agenda and then trying to convince a free-thinker that it's a good thing, and the benefits thereof, and how they outweigh the fact that someone is tracking everywhere you go, everything you do, and every move you make. "Oh but it's really a good thing, because we said it's a good thing"
There are 2 groups of people you can make fun of on the Internet without fear of attack. The illiterate, and the Amish.
Insurance company surveillance only adds another arc to the open circle of government control, and further deplete our liberties and rights. For instance, I am not a speeder when I am the only one or of few on the road, but during rush hours everyone has a personal agenda, maybe as simple as a full bladder or rectum, and the daytime speed limit does not apply. If I want to not be run over, I have to go with the flow. Insurance companies have imposed themselves over every area of our lives. There are insurance offers for every thing, and insurers decide your quality of life, how much of your money you get to keep, and what share they get to claim every month while writing the rules. No, enough of that already. Insurance is another form of government sanctioned thuggery and extortion. Now insurance companies want to monitor how I drive so they can regulate their portion. People should be required to keep a certain amount in an Insurance escrow account and the money belongs to group members individually. The money in escrow always belongs to the insured unless there is a claim. Large claims are paid out of the group, which the persons who were judged at fault have to repay to the group at 1.0% interest. If the insured fails to repay, they lose their driving and car ownership privileges and can pay someone to drive them around or take public transportation until they repay their damages amount. There always will be money to pay damages and good drivers are rewarded by having access to their escrow premium money in full plus 1% when they surrender their driving privileges. There always will be people maturing into the group. Insurance is about money, control, regulation, punishment and duress. People need to begin forming self-insured unions, or coops and defy insurance companies and regulators. That's all I'm saying. Unless I am provoked into saying something else.