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Why Letting Your Insurance Company Monitor How You Drive Can Be a Good Thing

Soulskill posted about 8 months ago | from the everybody's-an-above-average-driver dept.

Transportation 567

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."

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567 comments

Huh (5, Informative)

Anonymous Coward | about 8 months ago | (#45436265)

> 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...

Re:Huh (5, Insightful)

MightyMartian (840721) | about 8 months ago | (#45436529)

No kidding. The whole article feels like it should come with the heading "This message brought to you by the Insurance Industry, looking out for our^H^H^Hyour interests!"

Re:Huh (0)

AlphaWolf_HK (692722) | about 8 months ago | (#45436695)

Personally I wouldn't mind it as currently implemented (my insurance company doesn't offer it so I haven't done it) because they don't monitor you 24/7. With Progressive, they send you a device in the mail and you keep it in your car for a few weeks to pick up actual driving metrics, and then send it back.

If it could make my insurance cheaper, then perfect (though that is kind of hard - my car insurance is about $40 a month) I just won't visit the meth lab or the bath house during that time.

Re:Huh (3)

CubicleZombie (2590497) | about 8 months ago | (#45436829)

1. You get a discount for using the device.

2. You pay more for not using the device.

One sounds good and the other sounds bad, but both statements are actually the same.

The transition is when you look around and realize ALL insurance companies have the recorder. Kind of like the grocery store "discount" card. It seemed like a great idea at first.

Re:Huh (3, Interesting)

cayenne8 (626475) | about 8 months ago | (#45436703)

Whew...God forbid them monitor my driving.

I'd have to either start actually looking at the speedometer, or lose all hope of ever driving again...

:O

But the bigger picture is, I'm trying desperately to not give personal information to the govt or private companies....not voluntarily giving it to them!!!

I guess what is comes down to ... (5, Insightful)

easyTree (1042254) | about 8 months ago | (#45436299)

...is who decides what is safe driving?

Re:I guess what is comes down to ... (2)

easyTree (1042254) | about 8 months ago | (#45436321)

i.e. is safe driving, ponderously slow driving that may indeed reduce ones own collisions but enrages everyone else around, causing their accident rate to increase. Hopefully not.

Re:I guess what is comes down to ... (0)

Anonymous Coward | about 8 months ago | (#45436489)

Increasing the collison rate of those around you would make you look even better by comparison, saving you even more money.

Re:I guess what is comes down to ... (1)

MightyMartian (840721) | about 8 months ago | (#45436541)

Well fuck then! I'm going to start driving backwards, that way my insurance company gives me money!

Re:I guess what is comes down to ... (2)

easyTree (1042254) | about 8 months ago | (#45436583)

Yay \o/ doubly-nested reply to myself :S

It occurs to me that previously, there was a feedback loop in operation; that crashes are an unambiguous indicator of unsafe driving; whereas, now, will it be enough for the insurance company to say "nu-uh, your driving is unsafe" and thus break the loop, setting them free to be more imaginative when setting premiums?

Having said that, my insurance premiums are already a work of creative and greedy minds fiction - I've been driving for twenty-five years and am way safer now than I was when I owned my first sporty car. I now drive a far more sedate car yet my premiums are over THREE times what they were back then, this ignoring the effects of inflation. What's more, there is no significant variation in premiums between insurers and third-party-fire-and-theft premiums are essentially the same as fully-comprehensive; I feel as though I'm a fish, compelled to be in a barrel (we're required to have one of the two types of insurance), around which stand the heads of the various insurance companies with infinite-ammo shotguns :S Isn't there supposed to be *competition* in the marketplace?

Re:I guess what is comes down to ... (1)

0123456 (636235) | about 8 months ago | (#45436351)

...is who decides what is safe driving?

Studies have consistently shown that the safest drivers are around the 85th percentile by speed, so they really just need to measure how fast you go and charge more for the slower and faster drivers.

Re:I guess what is comes down to ... (2)

Hartree (191324) | about 8 months ago | (#45436461)

85th percentile speed drivers are often going above the posted limit. So, on most highways they would be giving a rate break to those who speed and penalizing those who obey the speed limit?

That'll be fun to hear them argue in court during the inevitable class action suit.

Re:I guess what is comes down to ... (2)

Valdrax (32670) | about 8 months ago | (#45436591)

Studies have consistently shown that the safest drivers are around the 85th percentile by speed, so they really just need to measure how fast you go and charge more for the slower and faster drivers.

Note that that's people doing at or under the 85th percentile of speed on the road. You don't start really getting dangerous slow drivers until you're several MPH under the average speed, which not the 85th percentile speed.

Re:I guess what is comes down to ... (1)

Jah-Wren Ryel (80510) | about 8 months ago | (#45436595)

Studies have consistently shown that the safest drivers are around the 85th percentile by speed, so they really just need to measure how fast you go and charge more for the slower and faster drivers.

So much wrong with that. You've mixed up traffic safety guidelines for setting maximum speed limits. If you think about it for a second, expecting everybody to drive at the 85th percentile speed is impossible.

Re:I guess what is comes down to ... (1)

i kan reed (749298) | about 8 months ago | (#45436413)

My inclination is to say "scientific experimentation" but that's a high target.

Re:I guess what is comes down to ... (1)

ackthpt (218170) | about 8 months ago | (#45436503)

My inclination is to say "scientific experimentation" but that's a high target.

I find it rather tricky to perform chemistry experiments while driving. Although driving can be highly useful for some physics experiments.

"Watch me run over that paper bag!"

WHUMP flopflopflopflopflopflop

"Dang, another beer bottle!"

Re:I guess what is comes down to ... (3, Interesting)

GameboyRMH (1153867) | about 8 months ago | (#45436455)

This is the problem. They've decided that safe driving is smooth driving with no sudden accelerations, decelerations or quick turns.

You know who drives like that? All those awful oblivious drivers who everyone else is dodging. And the people doing the dodging look like maniacs.

Re:I guess what is comes down to ... (2)

ackthpt (218170) | about 8 months ago | (#45436533)

This is the problem. They've decided that safe driving is smooth driving with no sudden accelerations, decelerations or quick turns.

You know who drives like that? All those awful oblivious drivers who everyone else is dodging. And the people doing the dodging look like maniacs.

You mean this 85-year old drivers, who are just fine until a split second of confusion sends their Crown Victoria through a crowd because they hit the gas instead of the brake.

Re:I guess what is comes down to ... (1)

GameboyRMH (1153867) | about 8 months ago | (#45436609)

I was trying not to be ageist... :-P

Re:I guess what is comes down to ... (0)

Anonymous Coward | about 8 months ago | (#45436639)

Ding ding ding, we have a winner.

Dodge the idiots or slam on the break to avoid the moron on the cell phone who swerved in front of you, pay higher insurance premiums.

Big Brother meets Big Business in the biggest threat to human rights since government....

Re:I guess what is comes down to ... (2)

Valdrax (32670) | about 8 months ago | (#45436633)

You know who drives like that? All those awful oblivious drivers who everyone else is dodging. And the people doing the dodging look like maniacs.

They are, typically. If you have to "dodge" in way that might make you "look" like a maniac and can't make a smooth, well-signaled transition into the next lane to go around, then you're not a good driver.

The road isn't a racetrack, and you don't score points for being the lead.

Re:I guess what is comes down to ... (0)

Anonymous Coward | about 8 months ago | (#45436757)

It's always amusing to me, watching the douchebags on the freeway swerving in and out of lanes to get one car ahead so that they can do 68mph instead of the prevailing speed of 64mph.

I'm sure they're thinking to themselves, "I'm such a good driver. Look at me leaving all these morons behind."

Re:I guess what is comes down to ... (1)

Valdrax (32670) | about 8 months ago | (#45436697)

I guess what is comes down to ... ...is who decides what is safe driving?

Statistics. That's pretty much what actuaries do. Picking a policy that encourages more payouts is bad for business. The better and more refined the data results, the better the profits.

But you won't have access to all the data! (0)

Anonymous Coward | about 8 months ago | (#45436301)

I assume what will happen is the insurance companies will find that 75% to 90% of their insureds are worse drivers in some way than average, and need to be charged more.

Re:But you won't have access to all the data! (1)

ackthpt (218170) | about 8 months ago | (#45436587)

I assume what will happen is the insurance companies will find that 75% to 90% of their insureds are worse drivers in some way than average, and need to be charged more.

To establish a mean, around where they will reduce premiums (or not raise them) someone must fall outside that range - no matter how skilled they are.

I feel the only thing this information will do is justify hitting some drivers up for an increased premium. 60+ years of driving statistics, with accidents, etc, should already be providing them with the sort of benchmarks they need.

Trust the industry, what could go wrong? (5, Insightful)

ackthpt (218170) | about 8 months ago | (#45436313)

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.

Re:Trust the industry, what could go wrong? (1, Interesting)

i kan reed (749298) | about 8 months ago | (#45436447)

Okay, yeah, it's annoying, but do you have objective evidence to suggest harm?

Re:Trust the industry, what could go wrong? (1)

MightyMartian (840721) | about 8 months ago | (#45436555)

Yes, because someone is going to follow said driver to their destination, and then beat them to death with a crowbar.

Re:Trust the industry, what could go wrong? (0)

Anonymous Coward | about 8 months ago | (#45436589)

Passing on the right? Are you serious? Maybe if you live in England that would be ok. Here in the states passing on the right is bad. Why? The most amount of car is between you and the driver. It is the biggest blind spot for any driver. I saw it summed up best on the back of a 18wheeler. Left=good right=death. They can see you better on the left.

I am a mediocre driver. Yet you *must* watch your blind spots. Or people will hover in them. They do not mean to as they are busy trying to drive. It just is. You need to be aware of it.

My guess is this will be the usual insurance model. You are dinged on something and your rates go up but magically never come back down unless you decide to move to another agency. When suddenly magically they 'can work it out'.

Re:Trust the industry, what could go wrong? (2)

i kan reed (749298) | about 8 months ago | (#45436693)

I don't like it either, but I was asking for objective evidence for a reason. What percentage of collisions are left-to-right lane merges with the right-hand driver in the blind spot? How does that compare against right-to-left changes? How often does passing on the left versus passing on the right happen on a given stretch of freeway?

You can allege something is a problem, you can even firmly believe in the rectitude of that assertion, but you will never know how much of a problem it is that way.

Re:Trust the industry, what could go wrong? (1)

Immerman (2627577) | about 8 months ago | (#45436669)

Pretty much anything that disrupts the smooth flow of traffic is going to increase the risk of accidents in the surrounding area.

Re:Trust the industry, what could go wrong? (1)

i kan reed (749298) | about 8 months ago | (#45436717)

Yours is the third completely subjective reply. Do you think I've never driven, and seen these things? My concern is for whether intuition is correct.

Re:Trust the industry, what could go wrong? (1)

Anonymous Coward | about 8 months ago | (#45436573)

Dude, whatever business wants, it's bad for us consumers.

There's never an exception.

And with insurance companies - they make their profit by denying claims by whatever means possible.

Investing premiums is just to pay the bills - like the obscene CEO's salary, stock options, benefits,perks and retirement.

And they (all of corporate America) spin it - it's usually follows the algorithm of "it's in the consumer's best interest ...." - Oh, dear! Watch out! They're picking your pocket when they insist that it's for our own good!

Always.

Please, someone give me an example of where I'm wrong - one example - so I can spank you publicly.

The Dunning–Kruger is strong with this one. (0)

Anonymous Coward | about 8 months ago | (#45436659)

If you reguarly drive 10-15 over the limit, you ARE a risk.

A trillion seconds? (5, Informative)

Antipater (2053064) | about 8 months ago | (#45436341)

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.

Re:A trillion seconds? (1)

GrumpySteen (1250194) | about 8 months ago | (#45436759)

It also tends to accentuate the fact that the author of the article is doing little more than reciting a press release from an insurance company since only the marketing department would willingly choose seconds as a unit in order to say they have a trillion of them.

Safe = Slow = Low? (1)

CMYKjunkie (1594319) | about 8 months ago | (#45436343)

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.

Re:Safe = Slow = Low? (1)

Guppy06 (410832) | about 8 months ago | (#45436419)

And if that were true in any sort of statistically meaningful way, that too would come out of the data.

Re:Safe = Slow = Low? (2)

ackthpt (218170) | about 8 months ago | (#45436435)

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.

Re:Safe = Slow = Low? (1)

Kaenneth (82978) | about 8 months ago | (#45436625)

I've always heard them called 'road turtles'

Re:Safe = Slow = Low? (1)

i kan reed (749298) | about 8 months ago | (#45436473)

Your argument is one against oversimplification, not data-driven insurance.

Re:Safe = Slow = Low? (1)

bob_super (3391281) | about 8 months ago | (#45436511)

You're looking at it wrong.

Slow = cheaper repairs + less hospital bills
What else do you think they care about?

Re:Safe = Slow = Low? (1)

ericloewe (2129490) | about 8 months ago | (#45436689)

Fewer repairs and fewer hospital bills.

Re:Safe = Slow = Low? (1)

bob_super (3391281) | about 8 months ago | (#45436831)

People here keep forgetting that if you get pushed for driving 10 under on the left lane, the other insurance pays the bills.

Re:Safe = Slow = Low? (5, Informative)

jonnythan (79727) | about 8 months ago | (#45436767)

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.

No recourse? (5, Insightful)

Waccoon (1186667) | about 8 months ago | (#45436347)

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.

if you have nothing to hide (5, Insightful)

Gothmolly (148874) | about 8 months ago | (#45436355)

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.

Only if (0)

Anonymous Coward | about 8 months ago | (#45436365)

Only if they would ever actually lower the insurance pricing: obviously they are pushing this forward to get better profits, not to get the same profit for more work.

The numbers don't add up (5, Insightful)

cowwoc2001 (976892) | about 8 months ago | (#45436367)

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!

Re:The numbers don't add up (3, Interesting)

bob_super (3391281) | about 8 months ago | (#45436567)

+1

You can't make high-risk populations pay the whole bill for their risk. That's not how insurance works.

In the case of driving you could say: "well then they can drive better". But that doesn't cover all the risk, whether you're too young, too old, or have a pet/kid/alcohol/disease distracting you this morning.

Re:The numbers don't add up (3, Interesting)

nharmon (97591) | about 8 months ago | (#45436621)

By identifying the high risk teenaged drivers we can target them with additional training and restrictions that will reshape their driving behavior and make them lower risk. And we could mandate that the insurance companies pay for some of that additional training.

This would similar to health insurance companies being mandated to cover preventative health services.

Re:The numbers don't add up (1)

SirGarlon (845873) | about 8 months ago | (#45436763)

By identifying the unhealthy people, we can target them for insurance-company-approved lifestyle changes such as diet, exercise, stress counseling, and mandatory maintenance drugs. How much intrusion are we prepared to accept in the name of the almighty dollar?

Re:The numbers don't add up (1)

Overzeetop (214511) | about 8 months ago | (#45436685)

Here's why: your driving skills may or may not vary over your life, and may go up or down. Your health is virtually guaranteed to get worse.

The ACA says that, until you're eligible for Medicare (because, let's face it, nobody in the bottom 99% is going to be able to afford health insurance rates when you're in your 70s) you should be able to get healthcare, and to make it "fair" (arbitrary decision), the worst person can't be charged more than X times the best person. To make up for it, the entire scale of actuary needs gets compressed. The really healthy pay more, the really sick pay less. The hope/goal - which is entirely untested - is that if everyone has healthcare, there will be *somebody* paying for the Billions of dollars in "free" healthcare which hospitals must provide to everyone regardless of ability to pay. Now, we all pay for those through higher medical rates. Will it work? hard to tell, really - and it will probably be 5+ years before we can even find out.

Re:The numbers don't add up (1)

realyendor (32515) | about 8 months ago | (#45436719)

The difference is that high-risk driving is a choice that one can make each day. On the other hand, most high-risk health conditions are not something that someone can fix instantly by changing their behavior. Now, there are indeed some high-risk health conditions that are a result of choice, such as smoking or unhealthy eating habits...but even with those, one can stop smoking, but there's a significant amount of damage that's already done that makes that person be a higher risk. If there's a way to adjust one's insurance premium based on the high-risk choices they make, it becomes more fair for everyone and helps to discourage high-risk choices.

Re:The numbers don't add up (1)

Jah-Wren Ryel (80510) | about 8 months ago | (#45436729)

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!

Part of the problem here is that the word "insurance" is over-loaded with multiple definitions. Most forms of insurance are about insuring against an accident. Universal health-care isn't about insurance any more than the national highway system is about auto-insurance. It is more like having a police force to 'insure' against crime. It is a public service that some people will use more than others.

Re:The numbers don't add up (0)

Anonymous Coward | about 8 months ago | (#45436747)

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?

You don't die without car insurance, but you do without health insurance. I'm willing to pay higher taxes to ensure that no cancer patient doesn't get surgery because their HMO didn't approve it, but I am not so that everyone can drive to work. When human lives enter the equation it's a whole different ballgame and thus their is no slippery slope.

No F#$KING way (4, Insightful)

Bucc5062 (856482) | about 8 months ago | (#45436373)

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.

Re:No F#$KING way (3, Insightful)

intermodal (534361) | about 8 months ago | (#45436577)

The thing about safe driving is, nothing these machines do can measure it. This tracking is the automotive equivalent of polygraph in terms of accuracy.

Re:No F#$KING way (1)

Anonymous Coward | about 8 months ago | (#45436713)

AGREE! I've got nearly 3/4 million miles behind me without a single ticket or accident. This tech doesn't make anyone a better driver. Using your brain and having some consideration for your life and those around you is what's needed. Now get off my lawn!

Re:No F#$KING way (2)

bmajik (96670) | about 8 months ago | (#45436739)

I'm inclined to agree with you. I have a fair bit of race track driving experience and have instructed other drivers at high performance driving schools.

I personally maintain my vehicles to a high standard and operate them according to their varying capability (I own everthing from a stripped out BMW racecar to a full-size schoolbus), and I of course vary my driving significantly based on my own mental/physical limitations and the prevailing road conditions.

But I'm not at all typical.

Once upon a time, I was told that my credit history negatively impacted my insurance premium. That's because I had no credit card usage to speak of. I had no debts of any kind, which didn't mean I was intrinsically risky, what it meant was that I fell outside of the model parameters that the actuaries and underwriters used.

So it is with my driving habits. I have reason to believe that, on the occasions when I drive 95mph, I am being at least as safe as the drivers who are going 75 but who take their vehicles and driving much less seriously than I do. I speed selectively when conditions are appropriate (high visibility, incredibly low traffic density, I'm wide awake and not otherwise mentally distracted, I know the vehicle condition/capabilities, etc).

Contrastingly, most people set the cruise at 75mph and then park in the left lane while they chat on their cell phone -- without a handsfree kit.

This little black box has no way of knowing that you just got in a fight with your spouse, or just got told bad news by your boss. Mental distractions like these are typically bigger accident factors than a naÃve measurement of vehicle speed.

So who's the bigger accident risk? An engaged me or a distracted average? I contend -- not me.

Will my insurer see things that way? Certainly not. So I'll expect to pay a higher premium because I understand I am atypical. And I'll avoid having one of these boxes as long as I can afford to do so :)

It can't possibly be accurate (2, Informative)

Anonymous Coward | about 8 months ago | (#45436387)

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.

the future of car insurance (-1, Troll)

larry bagina (561269) | about 8 months ago | (#45436393)

In 2031, President Chelsea Clinton-Obama III will abolish individual car insurance (if you like it, you can't keep it!) and make you buy comprehensive car insurance through the government web site. Filling up with gasoline now requires pre-approval from your insurance company. Most people drive a tesla since trips greater than 10 miles require a TSA escort within your car at all times.

Insurance Companies Are Not Interested In Reducing (5, Insightful)

Anonymous Coward | about 8 months ago | (#45436395)

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!

Re:Insurance Companies Are Not Interested In Reduc (1)

ericloewe (2129490) | about 8 months ago | (#45436761)

Sure they are, if the decrease is offset by the revenue from additional customers. Same as any business.

Re:Insurance Companies Are Not Interested In Reduc (0)

Anonymous Coward | about 8 months ago | (#45436807)

correct. they only want lower premiums to attract more customers so they can sell more policies and make more profit

The Maths (1)

Press2ToContinue (2424598) | about 8 months ago | (#45436405)

1 trillion seconds over 1.6 million drivers is 7.2 days per driver. ( 1000000000000 / 60 / 60 / 24 / 1600000 = 7.2 )
Thank-you Captain Obfuscation.

Safety? (1)

Anonymous Coward | about 8 months ago | (#45436417)

I'm a dreadful driver. I have a too powerful car (3.2ltr E class Mercedes). I accelerate too hard, brake late.

However I've not had a crash in 16 years and have never made an insurance claim. I've also have a clean uk license.

Put me onto a monitored system my insurance will shoot up. Why would I bother?

How can this work? (3, Informative)

jbmartin6 (1232050) | about 8 months ago | (#45436421)

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.

Re:How can this work? (0)

Anonymous Coward | about 8 months ago | (#45436651)

I've thought about this before and insurance is quickly making themselves irrelevant. If they can correctly assess the risk for each person in the pool at 100%, which this is a big step towards, then you premium will be your claims + their cut. At that point it doesn't take a rocket scientist to realize just don't pay them their cut because you are already paying for 100% of your claims every time.

Seems like the long term plan would be to have an "incident savings account" where you put in your monthly fee and pull out when you have an accident. Once it becomes "fully funded" then you no longer make payments until you do have an accident.

Re:How can this work? (0)

Anonymous Coward | about 8 months ago | (#45436795)

Except some unexpected costs have no ceiling. This is especially true with health care; You can be going along with your life just fine and then one day find out you have some rare form of cancer that will cost millions over several years. Maybe insurance is just a little bit important.

Re:How can this work? (1)

stewsters (1406737) | about 8 months ago | (#45436727)

That's the beautiful part. If you engage in dangerous activities, like crashing, they can just cancel your account before you call in for violating their TOS. It's like a money farm!

Re:How can this work? (2)

NJRoadfan (1254248) | about 8 months ago | (#45436765)

Buried somewhere on Progressive's website is a sob story of how for every $1 in premiums the car insurance industry collects, $1.02 is paid out in claims. Yet, every company seems to have a large advertising budget to drill in that they can save you "XX or more" on car insurance.

On the opposite end of things, there are car insurance companies that solely insure high risk drivers in some states. A friend of mine was dropped by a company because he was "too safe a driver". Yes, that was the official reason. Not surprising, a few months later the company went bust.

What are they monitoring? (0)

Anonymous Coward | about 8 months ago | (#45436427)

This question needs a detailed answer.
How does the company adjust rates based on these profiles? They need to offer very specific calculations.
The insurance company should also publish the anonymous data so users can do their own comparisons.
If they are using this for legitimate purposes and they want to be a positive influence on their customers, they must be much more open.
Otherwise, it's just another marketing ploy.

self driving cars (0)

Anonymous Coward | about 8 months ago | (#45436433)

I can't wait until self driving cars put these parasites out of business.

Re:self driving cars (0)

Anonymous Coward | about 8 months ago | (#45436579)

I can't wait until self driving cars put these parasites out of business.

"Oh, your car is running this old version of WinCar 2021, your insurance pricing is multiplied with risk factor of seven."

Huge discounts (4, Insightful)

smooth wombat (796938) | about 8 months ago | (#45436457)

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.

British people (0)

Anonymous Coward | about 8 months ago | (#45436467)

Criticizing American's at every turn and then getting anal probed by their own government and being fine with it.

Taking the insurance out of insurance (4, Insightful)

guises (2423402) | about 8 months ago | (#45436497)

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).

Profit! (0)

Anonymous Coward | about 8 months ago | (#45436507)

1. Install GPS recording devices into cars
2. tell people that it is actually good for them
3. profit!

Wow, must be first time ever!

What makes me a safe driver? (2)

dwillden (521345) | about 8 months ago | (#45436509)

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.

This is the opposite of health care (0)

MobyDisk (75490) | about 8 months ago | (#45436525)

This is interesting.

While health insurance is moving away from personal responsibility, car insurance is moving more toward it. This probably makes sense because people are not at fault for many health conditions. But people are often at fault for driving accidents.

I wonder how long before we pay an insurance company for a car wellness program. Will they make sure I am checking my oil and rotating my tires regularly?

More surveillance (1)

Anonymous Coward | about 8 months ago | (#45436535)

Oh sure, its great to let your insurance company track and monitor your driving habits. Safer drivers MAY pay less but i'll bet that less safe drivers simply wind up paying EVEN MORE than they do now.

These are businesses. They exist to generate a profit. Which is more profitable? Charging safe drivers less or bad drivers more? It doesn't matter if you are a safe driver, your rates eventually will go up. It makes far more sense to charge bad drivers more immediately rather than to reduce the cost to safe drivers, after all everyone is used to the current rates and like every other industry the insurance companies collude to keep prices high.

Now, that's all fine and dandy. But adding more surveillance in your everyday lives is ridiculous. All it takes is the LEO's knowing this data exists before they start pushing for warrants and access (or worse warrantless access) to it to make their jobs easier. Get a listing of all vehicles in X area at Y time on Z date, and start from there hunting for someone to force into a plea bargain. Job done, citizens safe, and did you see the hooters on that chick?

Offer lower rates? (4, Informative)

Overzeetop (214511) | about 8 months ago | (#45436565)

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.

Mandatory PRISM comment (0)

Anonymous Coward | about 8 months ago | (#45436571)

Since no one else has made it. We have the feds tracking every other aspect of our lives, is letting them track our exact driving habits really such a good idea?

As the law is explictely in the US and secretly in the UK, the government can have complete access to the data without even telling anyone about it. Installing a tracking device will be a completely moot point, as it is done "voluntarily".

Re:Mandatory PRISM comment (1)

Overzeetop (214511) | about 8 months ago | (#45436721)

You're carrying around a persistent GPS/location device, in a vehicle marked with a uniquely identifiable number. They're not really gaining anything through this if you're paranoid enough.

Re:Mandatory PRISM comment (1)

WillAffleckUW (858324) | about 8 months ago | (#45436775)

We already have that data. All the traffic light license plate cameras feed into a tracking program already.

We're just not admitting we have it.

See the difference?

If we admit we already know it, you'll get upset that you live in East Germany, not America ...

Clueless. (2)

JustNiz (692889) | about 8 months ago | (#45436601)

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.

Did it, saved money... (4, Interesting)

Anonymous Coward | about 8 months ago | (#45436605)

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.

Are you kidding?! (0)

Anonymous Coward | about 8 months ago | (#45436607)

Would you like also to monitor my oxygen levels while I sleep to make sure I'm "healthy"? How about the way I vote? Am I not voting for candidates that are safe for your industry?

It has nothing to do with safe driving it is just another way to mine money from hard working people. I will always try not to do business with a company that wants to monitor any part of my private life. Screw you, and you damn well can insert that device of yours in an inappropriate manner.

On the other hand ... (0)

jamesl (106902) | about 8 months ago | (#45436629)

... Obamacare wants to charge high rates (relative to the risk) for healthy young people so they can charge less for the elderly or reckless who are at high risk for a claim.

Re:On the other hand ... (1)

Overzeetop (214511) | about 8 months ago | (#45436821)

Test their theory - get all your young, healthy friends to start engaging in risky behaviors to increase your use of the health system and prove to them that this was a bad idea.

OTOH, I'm in favor of letting young, healthy people opt out. You get to choose at 18 (26 if your parents have you on their insurance) if you want "in" on the system. If you opt in you're guaranteed the system access and benefits for as long as you remain in the system. If you opt out, you never have to buy insurance. BUT, you're not guaranteed coverage later (i.e. pre-existing conditions may be excluded and/or you may be denied or dropped - just like it is today), and hospitals are no longer required to care for you if you don't provide advanced payment - even in emergency situations.

This is stupid (2)

girlintraining (1395911) | about 8 months ago | (#45436645)

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.

Re:This is stupid (1)

JustNiz (692889) | about 8 months ago | (#45436711)

>> Insurance isn't supposed to be about profit, it's supposed to be about cost-management.

Except you're missing the fundamental point that insurance companies are for-profit businesses rather than charities.

I agree, it can be a good thing (1)

WillAffleckUW (858324) | about 8 months ago | (#45436751)

If you're a sheep.

If you like being a Serf.

In that case, it's great!

In my cse, it's not a good thing... (0)

Anonymous Coward | about 8 months ago | (#45436783)

I drive often, I love acceleration, I love breaking tightly and I love nasty turns...
And due to winter, I love hand brakes and drifting...

Not a good thing for me...

Slashdot = consistent example of what not to post. (0)

Anonymous Coward | about 8 months ago | (#45436787)

You cannot predict how data will be used, and there is a significant chance
that the data will be used in a way that you find unpleasant or financially
detrimental in a possibly extreme fashion.

What's next, an article on the benefits of eating shit, as exemplified by the
posting habits of Slashdot editors ?

Is it really Insurance? (0)

Anonymous Coward | about 8 months ago | (#45436789)

Let's jump straight to the ad absurdum argument. Suppose insurance companies develop a way to predict the exact future of an individual, and so determine exactly the amount he/she will cost them over the next year, down to the fractional penny. And so, of course, that becomes your rate (with overhead, of course). This is labelled as "good driver discounts" or "healthy lifestyle kickbacks" or something like that, but the point is the same: give rate cuts to the safe people and stick the dangerous people with the burden. Of course, every insurance company does this, because otherwise they would be charging the safe majority more than their competitors, and risk losing business (which would then give them no base to subsidize with, and so they would no longer even be able to do so).

At this point, is there a point to having insurance at all? The difference between having insurance and not is just when you pay, plus whether there is overhead, and whether you have to submit to having your brain scanned, your genome sequenced, and the bumps on your forehead measured.

In all seriousness, at this point insurance companies are quite obviously trying to not act like what I used to think insurance companies were. The model they are pursuing would ultimately lead every rational person to not purchase insurance, and will lead to a model where every single insurance customer is slightly worse off than they would be without insurance (as opposed to our current system, in which most customers are worse off, but a few customers are significantly better off). They have a captive market, and are competing for simply being the best alternative to the competition.

Why not to allow recorded data... (0)

Anonymous Coward | about 8 months ago | (#45436793)

Because first it will be just for the insurance companies to use, to save you money, no really!

And then the police will start issuing warrants to get specific driving data, to combine with other meta data, to track your movements.

And then the NSA will start sending secret letters for all data to be added into their system...

And then?

CAPTCHA: Beyond

Two separate problems (0)

Anonymous Coward | about 8 months ago | (#45436799)

First, does acceleration and braking correlate perfectly with insurance losses?
Sure it seems intuitive that a speed demon is riskier, but it is really the skill and diligence of the driver that determines risk.

Second, the entire point of insurance is to spread risk across a population. The only fair departure from that is to penalize
the person that makes a lot of claims; Until that minority report computer can predict our accidents in advance too....

Orwellian (1)

ficuscr (1585141) | about 8 months ago | (#45436819)

I took issue with Progressive when they suggested I place their device on my car. I switched to Gieco as a direct result. Who wrote this anyway, that Flo lady? Hope others also object and change insurance providers. This is too invasive as far as I am concerned.
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