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Pay-As-You-Drive Car Insurance

michael posted more than 10 years ago | from the cheaper-ha-ha-ha-ha dept.

Privacy 472

Sipos writes "The BBC has a story about pay-as-you-drive car insurance. There is not that much detail about how it would work but it seems that a black box in your car monitors your position using GPS. This information is then reported to a insurance company computer which then works out which roads you used and then bills you accordingly. The article seems to suggest that this will make insurance cheaper. Surely this will only happen for people who drive on dangerous roads less than average, after all there are no less accidents as a result? It also makes no mention of the potential for abuse of privacy this could involve. Are people really prepared to let insurance companies track their every move to save money on car insurance?"

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Big brother-in-law, the insurance salesman (5, Insightful)

qmchenry (266894) | more than 10 years ago | (#10033664)

I'm already thinking of hacks... I wonder how hard it would be to spoof GPS signals? Of course, 5 cents worth of aluminum foil over the sensor would work, too. Only if they correlate their measure of distance versus the car's odometer would they know if the system had been duped.

They could also know if you were speeding on a certain stretch of road and up your premium accordingly. "We noticed that you failed to signal your intention to turn 18 times last month. Tsk tsk. Oh, and apparently you've been eating at McDonald's quite frequently, so we've increased your health and life insurance premiums, too."

Re:Big brother-in-law, the insurance salesman (0)

Anonymous Coward | more than 10 years ago | (#10033675)

No, just think of the terrorism this'll help prevent.

Re:Big brother-in-law, the insurance salesman (4, Insightful)

realdpk (116490) | more than 10 years ago | (#10033683)

And when you decide to opt out of it, will they count your "violations" against your score as if they were ticketed? Probably.

Re:Big brother-in-law, the insurance salesman (4, Informative)

StarOwl (131464) | more than 10 years ago | (#10033868)

Articles on one insurer in the US doing this in the US include:

Insurer Eyes Driving Habits [myrtlebeachonline.com]

Insurers offer discounts to customers who allow their driving to be tracked by electronic monitors [cnn.com]

Progressive to Use Data-Logging Device To Help Drivers Save Money On Auto Insurance [businesswire.com]

In the current US trials, reporting the driving information is voluntary. Of course, if/when more consumers participate, I'd expect base rates to go up as the folks most likely to qualify for discouts increase their participation.

Fortunately (or unfortunately for me, since I develop auto insurance rates at another company) the rating algorithm is patented by one company, so I wouldn't expect to see widespread adoption of this technology in the US anytime soon.

Re:Big brother-in-law, the insurance salesman (0, Troll)

Neophytus (642863) | more than 10 years ago | (#10033748)

Well, with the USA decreasing GPS accuracy to miles rather than metres on a whim I don't see drive-through tracking being introduced any time soon.

Re:Big brother-in-law, the insurance salesman (0)

Anonymous Coward | more than 10 years ago | (#10033830)

When and where? Or are you just talking about in war zones like in Iraq and Afghanistan?

Re:Big brother-in-law, the insurance salesman (5, Funny)

Anonymous Coward | more than 10 years ago | (#10033756)

"Of course, 5 cents worth of aluminum foil over the sensor would work, too."


Great, so it's not enough anymore to just make a tinfoil hat for myself. Now I have to make one for my car, too!

Track me while I say (-1, Troll)

Anonymous Coward | more than 10 years ago | (#10033666)

FP!

No thanks (1)

Alcemenes (460409) | more than 10 years ago | (#10033668)

I think my insurance rates are as low as they're going to get, as little as I drive. I think I'll pass on this one.

Re:No thanks (1)

superpulpsicle (533373) | more than 10 years ago | (#10033763)

An insurance company that uses technology well? That sounds like a version 1.0 concept.

I'll pass too and wait for this the idea to mature before they mess up my insurance.

Re:No thanks (4, Insightful)

beakerMeep (716990) | more than 10 years ago | (#10033789)

Exactly. It leaves me wondering too, wouldn't the insurance companies be against this for the same reason the cable companies are against a la carte programming? Because the good subsidize the bad. Obviously they wouln't want to do this if the majority of people are going to save money as that would just decrease their revenue. Hence I think the "save money" thing is really just a ploy to implement a new system that would actually have the same effect (for most people) of increased rates. Thanks but no thanks.

Re:No thanks (1)

letxa2000 (215841) | more than 10 years ago | (#10033852)

It lets the insurance companies better calculate and allocate risk. Insurance is all about risk and probabilities. The more information you have to better calculate those risks and probabilities, the more certain you can be of your risk as an insurance company.

It's also doubtful this involves major insurance discounts. It probably involves a discount that is slightly less than the marginal benefit for them of having better information.

Simple Fix (0)

Anonymous Coward | more than 10 years ago | (#10033673)

Why don't they just take down the miles of the odometer.

Re:Simple Fix (4, Informative)

mikael (484) | more than 10 years ago | (#10033882)

Why don't they just take down the miles of the odometer

Some people do try that. However, odometers are designed in such a way that it obvious to see when the number has been reversed (the gears have assymmetric shaped teeth that allow the odometer to count upwards). Odometers which have been "clocked back" usually have numbers that are misaligned like certain styles of web page counter.

hmmm, not for me (3, Insightful)

Thiago Ize (730287) | more than 10 years ago | (#10033677)

Well that sucks for me as I tend to always go above the speed limit. Sometimes a mile above, sometimes 20. I'm pretty sure they would be actively checking the way you drive and if you drive too fast, be prepared for some rate increases.

Re:hmmm, not for me (0)

Anonymous Coward | more than 10 years ago | (#10033811)

Well that sucks for me as I tend to always go above the speed limit. Sometimes a mile above, sometimes 20.

Wow. How do you pull into your driveway without slowing down? I speed too, but not always!

Wrong turns (5, Interesting)

Anonymous Coward | more than 10 years ago | (#10033679)

So what happens when I make a wrong turn in LA and end up in watts or compton, does my insurance skyrocket?

Re:Wrong turns (2, Interesting)

catbutt (469582) | more than 10 years ago | (#10033758)

If you make a wrong turn into opposing traffic, your insurance will go up as well. And?

Re:Wrong turns (1)

Florian Weimer (88405) | more than 10 years ago | (#10033761)

So what happens when I make a wrong turn in LA and end up in watts or compton, does my insurance skyrocket?

It's probably part of the concept that people who take wrong turns more often than usual pay above-average fees. 8-)

cheaper on average because (4, Insightful)

catbutt (469582) | more than 10 years ago | (#10033680)

people will alter their behavior if they are being charged this way. Just as you will use less electricity if it is being metered rather than an "all you can eat" plan.

Re:cheaper on average because (1)

e9th (652576) | more than 10 years ago | (#10033819)

This is insightful. Charge people more for driving during rush hour to encourage mass transit use. Do the same for sporting events, etc.

I'm not sure I'd like to see this happen, but I wouldn't be surprised if it did.

Re:cheaper on average because (0)

Em Ellel (523581) | more than 10 years ago | (#10033844)

people will alter their behavior if they are being charged this way. Just as you will use less electricity if it is being metered rather than an "all you can eat" plan.

Yes, but electricity is still more expensive even after changed behaviour than before. So now you are getting less and paying more.

Pay As You go eh? (5, Funny)

Anonymous Coward | more than 10 years ago | (#10033682)

Here is my idea. Pay as you go sex. If you last 3 minutes you pay for 3 minutes only.

your dog and/or right hand don't need your money (-1, Troll)

Anonymous Coward | more than 10 years ago | (#10033729)

blah!

Pay As You go eh?-Bout. (0)

Anonymous Coward | more than 10 years ago | (#10033826)

"Here is my idea. Pay as you go sex. If you last 3 minutes you pay for 3 minutes only."

Pay as you go? Alright Tyson. See if you can last the first round.

Do We Really Need Mandatory Insurance? (2, Funny)

josh3736 (745265) | more than 10 years ago | (#10033685)

I'm not a fan of the government-imposed insurance tax. If someone smashes into you (and is found at fault) who has chosen not to have insurance, you take them to court and force them to pay for your car.

If you smash into a tree, it's your own damn fault if you don't have insurance.

Dear government, please stop telling me how to spend my money.

Thank you.

Re:Do We Really Need Mandatory Insurance? (1)

samael (12612) | more than 10 years ago | (#10033698)

They're forced only to have third-party insurance. This prevents very poor people from injuring people and then being unable to pay for the damage.

Re:Do We Really Need Mandatory Insurance? (1)

Skater (41976) | more than 10 years ago | (#10033701)

Yes, but what if you hit me and you don't have the money for my medical bills you've caused? Or the money to pay for my car? What then?

--RJ

Re:Do We Really Need Mandatory Insurance? (1, Insightful)

josh3736 (745265) | more than 10 years ago | (#10033769)

We could set up a "payment plan" for the uninsured. The court could mandate that $X or X% of every paycheck goes to paying off the person you hit.

This way, you can choose to risk it by not buying liablity insurance. But if you do hit someone, then that person would still be compensated for damages.

I'm just trying to think of new ideas. As long as I can afford liablity, I'll probably but it. What I don't like is laws which force me to buy it even if I don't want it or can't afford it.

Re:Do We Really Need Mandatory Insurance? (1)

Skater (41976) | more than 10 years ago | (#10033795)

Yes, but I would need a new car *now* (or my current car fixed) because of someone else's negligence. The payment plan does nothing to address that issue.

If you can't afford it, don't drive.

--RJ

Re:Do We Really Need Mandatory Insurance? (1)

letxa2000 (215841) | more than 10 years ago | (#10033873)

So make it so YOUR insurance company covers you for what you suffered from the uninsured motorist, and the uninsured motorist has to pay X% of his paycheck until it is paid off to the insurance company. The injured party is taken care of immediately and the insurance company recovers its loss.

Re:Do We Really Need Mandatory Insurance? (1)

RadioTV (173312) | more than 10 years ago | (#10033796)

A payment plan doesn't do me much good if I am out a $30,000 car and have several thousand dollars in medical bills.

Re:Do We Really Need Mandatory Insurance? (1)

ewieling (90662) | more than 10 years ago | (#10033853)

Yes, but what if you hit me and you don't have the money for my medical bills you've caused? Or the money to pay for my car? What then?

This is exactly what no-fault insurance is supposed to avoid. YOUR insurance company pays YOUR bills, the other person's insurance company pays THEIR bills. If you don't have insurance then you don't get anything.

Re:Do We Really Need Mandatory Insurance? (4, Insightful)

kavau (554682) | more than 10 years ago | (#10033704)

If someone smashes into you (and is found at fault) who has chosen not to have insurance, you take them to court and force them to pay for your car.

And what if they hold a minimum-wage job at McDonald's? You'd probably be waiting 500 years to get your money.

McPayout. (0)

Anonymous Coward | more than 10 years ago | (#10033866)

"And what if they hold a minimum-wage job at McDonald's? You'd probably be waiting 500 years to get your money."

Funny. That's how long McEmployees have to wait too.

Re:Do We Really Need Mandatory Insurance? (1)

e9th (652576) | more than 10 years ago | (#10033711)

Unfortunately, the uninsured person who smashes into you often has no assets to go after.

Re:Do We Really Need Mandatory Insurance? (0)

Anonymous Coward | more than 10 years ago | (#10033716)

But if the defendant doesn't have enough money to pay for your car repair and you take him to court, you have a bit of a problem. If that person severely injuries you, then the likelihood of your getting reasonable compensation from the average person is pretty small.

The reason you have to buy insurance is so that the insurance company will always be able to pay if you are at fault in a wreck. (Though you'll probably have to take the company to court.)

Re:Do We Really Need Mandatory Insurance? (1)

catbutt (469582) | more than 10 years ago | (#10033724)

And what if the amount of damage is in the hundreds of thousands of dollars? How is a court going to force them to pay money they don't have?

As for smashing into a tree, that is collision insurance, which is optional. Liability is what is required.

Re:Do We Really Need Mandatory Insurance? (0)

Anonymous Coward | more than 10 years ago | (#10033755)

Dear government, please stop telling me how to spend my money.

You don't have to buy insurance if you post a bond that covers the minimum liability with your own assets. So you have nothing to complain about.

Re:Do We Really Need Mandatory Insurance? (2, Interesting)

Stile 65 (722451) | more than 10 years ago | (#10033838)

New Hampshire actually has no mandatory liability insurance law. Virginia has a "bond" option - you could deposit a certain amount of money with the state in lieu of insurance coverage.

That makes me think. I was in Kentucky last year and got a ticket for driving without proof of insurance (I'm from VA and plan on moving to NH in a few years). Now I have insurance, just didn't have proof on me at the time, so I'm all right, but what if I didn't have it but it was legal in my state for me not to? Would they still penalize me?

Also, when I move to NH, I'm going to make sure and get good uninsured motorist insurance. It's good not only for being hit by someone without insurance, but, as I found out a couple of years ago, for hit-and-run situations. Someone smacked into my rear bumper and then went right on going, and uninsured motorist covered it (minus my deductible).

Good point is that.... (2, Interesting)

djsmiley (752149) | more than 10 years ago | (#10033688)

A good thing about this...

Every one hates being charged for bad drivers (in the UK this is especially true, trust me, having the slowest car ever and having insurance that costs more than the car ever will).

It means that can basicly monitor your speed, they can then see the fast, and the slow drivers (and slow being dangerious on motorways (freeways?)).

This would mean that they would be able to see your REAL driving skill. Surely this is a good thing, but like always the public will throw it out due to "privicy". (Bit like the idea of IDcards? only people that complain are the criminals with something to hide).

Just my 2bits...

Re:Good point is that.... (0, Offtopic)

Sexy Bern (596779) | more than 10 years ago | (#10033694)

Just my 2bits...

Wouldn't that be 10 bits?

Re:Good point is that.... (1)

djsmiley (752149) | more than 10 years ago | (#10033781)

He scores 1, i score 0?

Guess im scoring in a 1bit process....

Re:Good point is that.... (1)

djsmiley (752149) | more than 10 years ago | (#10033808)

or maybe its a 0-bit mod?!

Why not? (4, Insightful)

kavau (554682) | more than 10 years ago | (#10033689)

Are people really prepared to let insurance companies track their every move to save money on car insurance?

Why not? It makes perfect sense for people who use their car only every once-in-a-while. Why should they pay as much as someone who is commuting from LA to SF twice a week?

I think many people feel they've nothing to hide and would opt for this payment plan if it can save them significant amounts of money. And as long as it is voluntary (i.e. you can always go with a flat rate), I don't see a problem with it.

Re:Why not? (1)

Skater (41976) | more than 10 years ago | (#10033728)

The number of miles I drive is taken into account on my policy in two ways:

1. The number of miles I drive each year on each car, and
2. The number of miles I drive one-way to work each day.

So, mileage driven is already being taken into account in my premium. This is a more-accurate way to measure it.

I'll stick with my flat-rate plan, though - I don't want my insurance company penalizing me because I speed on the DC beltway, and I don't want to receive a bill that's huge one month because I took a trip.

--RJ

Re:Why not? (1)

Xugumad (39311) | more than 10 years ago | (#10033840)

Well, sign me up anyway. I don't have a car, and one of the reasons I'm avoiding it is the incredible insurance costs for a first time driver, esp. given I'd basically be using it once or twice a month. They can tell I drove from my house, to the next city over? Well, yes, I care, deeply...

Re:Why not? (0)

Zebbers (134389) | more than 10 years ago | (#10033875)

Because it wont work that way. Ins companies make their money by having those who drive little....or even more so dont have accidents subsidize those that do. This will never, ever work...except to raise rates to unreasonable levels.

Honestly....You may drive half the time than I, but I have never ever been an accident while you have been in one or two. Accidents are just as much about defensive driving as they are chance and risk.

Sceptical (1)

Spudley (171066) | more than 10 years ago | (#10033691)

The article seems to suggest that this will make insurance cheaper.

I saw the BBC's news report on TV on this a couple of days ago. They did say that this is how the insurance companies are marketing it, but the reporter came over as being pretty sceptical of it actually doing so.

Re:Sceptical (1)

Neophytus (642863) | more than 10 years ago | (#10033710)

We have a choice here of metered or flat rate water. Metered is cheaper for low users, flat rate for higher. I also saw the article and I'm fairly sure it was leaning towards the same thing.

I want my privacy...ooooh! Money! (2, Insightful)

Hatechall (541378) | more than 10 years ago | (#10033696)

Are people really prepared to let insurance companies track their every move to save money on car insurance?

Since when has the general public made it a bpoint to care about their Privacy over Money? You think that the existing lack of privacy occured because the masses didn't have a choice, or were just lazy and took shortcuts allowed by corporations?

I don't trust 'em (4, Insightful)

ameoba (173803) | more than 10 years ago | (#10033700)

Based on my experience with insurance companies, I don't really expect to see them use this to lower premiums, just to raise them and have excuses to terminate policies.

A great example of the shadiness of insurance companies happened a few years ago in Washington State. The insurance companies lobbied heavily to limit driving privliges for those 16-18 (limited number of minors as passengers, restrictions on driving after dark and whatnot) citing studies saying that it'd reduce the accident rates by a significant margin, which it did. The problem is that they never adjusted the insurance rates downwards to reflect these lowered accident rates, effectively giving their profits a big boost.

what i'm willing to do (1)

ledbetter (179623) | more than 10 years ago | (#10033703)

I live in Canada, where the costs of car insurance have risen dramatically over the last few years. I drive a 12 year old car, have a perfect driving record and am over 25. I didn't even ensure it for collision (which is the most expensive part of the premium). And still, I pay over $2000/year for insurance.

Basically i'm willing to sell my soul to the devil for cheaper insurance. If the devil wants me to drive with a black box, then so be it.

Re:what i'm willing to do (1)

Evangelion (2145) | more than 10 years ago | (#10033739)

Basically i'm willing to sell my soul to the devil for cheaper insurance.

Or vote NDP.

Wait....

Re:what i'm willing to do (1, Informative)

Anonymous Coward | more than 10 years ago | (#10033764)

Get a newer car and safer car. My last car was a '95 mazda protege and i was paying $1200/year with liability only. I recently bought an A4 and my insurance rose to $1400/year with collision. Collision on the protege would have raised my insurance to over $1800/year

Kinda creepy, and probably only worth it to a few. (1)

halo1982 (679554) | more than 10 years ago | (#10033709)

I'd imagine that much like pay as you go cell phone service, pay as you go car insurance will only be economical to very few individuals...maybe someone in a very large city who only drivers their car a few times a month.
Can you imagine all the different things they would see you do that could cause them to increase the rates? Driving more than 500 miles a month, driving after 10pm, driving home from a bar, speeding any amount, rolling stop signs, driving in the rain or other poor weather, driving in heavy traffic....insurance companies are already a little crazy about the rates, and unless there was some maximum monthly cap I could see this being bad for a lot of people.
Not to mention its just plain creepy.

Re:Kinda creepy, and probably only worth it to a f (1)

Walt Dismal (534799) | more than 10 years ago | (#10033740)

Hot, fresh pizza in only 30 minutes or your money back! Um, that pizza will be $195 - we have to pay for the insurance.

Re:Kinda creepy, and probably only worth it to a f (1)

KyleCordes (10679) | more than 10 years ago | (#10033786)

Actually you'll also pay a lot because your car was parked in a large city when you weren't driving it. It's more likely to be stolen there than out in the middle of nowhere.

Your rights online? (1)

maelstrom (638) | more than 10 years ago | (#10033712)

Smoking crack is good kids.

Dupe of Previous Story (1, Redundant)

the pickle (261584) | more than 10 years ago | (#10033717)

This is a near-total dupe of Big Brother in Your Front Seat [slashdot.org] , from 10 August.

I think Michael's RAM chips need a parity check. There's a failed chip in there somewhere...

p

Monitor my driving? (1)

malus (6786) | more than 10 years ago | (#10033718)

But of course.

I currently pay $1500 a year, with a PRISTINE driving record, for a 100% paid-off nissan, and a 2002 Jeep wrangler (still making payments).

I drive ZERO miles to work, and average 10-20 miles per week.

Why I am paying this much for insurance? Because I'm living in a state with bad statistics. I would GLADLY let my insurance company monitor my driving, or lack thereof, to save money (if the money's right, of course)

Re:Monitor my driving? (1)

Skater (41976) | more than 10 years ago | (#10033747)

Where do you live? I live in Alexandria, VA and pay much less than that for a two-car policy, and I drive 8 miles one way to work each day.

--RJ

Uk resident's view (1)

JimStoner (93831) | more than 10 years ago | (#10033723)

I would welcome such a scheme if I still had my car - I finally got rid of it about a month ago. Actually the council kindly stuck some "abandoned car" stickers on it, then towed it away a few weeks later, but that is another story :D

It was costing me 500 GBP per year to insure a 15 year old Ford Sierra for 3rd party fire and theft. The car was only worth a few hundred max.

I rarely drove it - maybe 500 miles a year.

Under these conditions, I would welcome only being charged for how far I drive.

Re:Uk resident's view (1)

julesh (229690) | more than 10 years ago | (#10033794)

Actually the council kindly stuck some "abandoned car" stickers on it, then towed it away a few weeks later, but that is another story :D

They are getting rather overzealous with those. I have a friend who had the police knocking on his door to find out if the 5 year old Escort parked outside his house was his... because it had been reported as abandoned. If he'd been away for two weeks, it would have been towed away. If he'd been away for eight, it might have been scrapped before he found out about it.

"I'm sorry sir..." (4, Insightful)

nzgeek (232346) | more than 10 years ago | (#10033727)

"...but our GPS log show that you were travelling at 56 mph moments before the accident. We're going to have to decline your claim..."

People don't seem to realise that an insurance company's sole purpose in existence is to NOT pay out on claims. Otherwise how do they increase their profits?! Anything that can help them reduce the percentage of claims that are paid out will be snapped up.

Re:"I'm sorry sir..." (4, Insightful)

Skater (41976) | more than 10 years ago | (#10033772)

They make money not paying claims, but they make more money on investments. That's the real profit - the collecting of premiums and paying claims is just supporting their stock market habit.

--RJ

OT sort of (1)

gilroy (155262) | more than 10 years ago | (#10033837)

Blockquoth the poster:

the collecting of premiums and paying claims is just supporting their stock market habit.

This is true of all insurance, including malpractice. There's increasing evidence that the "runaway malpractice crisis" in America is actually a simple cyclical effect, as the market fluctuates. But pretty soon we're probably going to institute "tort reform" that will strip patients and consumers of redress in court, while doing nothing to actually rein in costs. But at least we'll stick it to all those blasted trial lawyers... well, except the appropriately housebroken corporate ones. (No one seems to ever notice that there are lawyers on both sides.)

Cheaper Insurance (1)

antiMStroll (664213) | more than 10 years ago | (#10033730)

"The article seems to suggest that this will make insurance cheaper."

When I moved to an area where insurance is cheaper, from the high-traffic centre of town to a community ten minutes outside the city limits but still less than a twenty from work, my insurance went up because I was driving further. When I later moved back into town, it went up again because, although my drive was now five minutes, traffic is higher in town. Is this the kind of "cheaper" they mean? It usually is.

"Are people really prepared...?" (0)

Anonymous Coward | more than 10 years ago | (#10033733)

In two words - YOU BET!

businesses will likely love it (0)

Anonymous Coward | more than 10 years ago | (#10033737)

this sounds like something the business sector and rental companies may pick up on first, with private citizens possibly coming in later.

Insurance is all about LACK of information (0)

Anonymous Coward | more than 10 years ago | (#10033743)

The whole point of insurance is that it's heding a lot of bets, taking a bunch of risks and average it out over the long time. The more insurance knows about each individual driver's records/risks, etc., the less the whole concept of insurance works out. If you drive poorly, they charge you higher or won't insure you, so you may as well not have insurance. if you drive well, they theoreticaly won't charge you as much... either way, if they have perfect information about you, then they'll charge you exactly what your expected expenses are.. plus a profit for them. Which means in a world of perfect information like they're suggesting, you end up basically paying them pure profit... So in the end, only they win.

Your life is an open book anyways (3, Insightful)

kavau (554682) | more than 10 years ago | (#10033750)

Are people really prepared to let insurance companies track their every move to save money on car insurance?

People don't have a problem with their credit card companies tracking every cent they are spending, so why should they have problems with this?

"If it saves just one life.." (1, Insightful)

Anonymous Coward | more than 10 years ago | (#10033752)

...is what the weasels will say, then the sheep will start bleating it, then the pigs will snort at all the other animals that don't want to go along.

REPOST (0)

Anonymous Coward | more than 10 years ago | (#10033765)

here ya go ... [slashdot.org]

Funny thing... (1)

kleinux (320571) | more than 10 years ago | (#10033783)

I was just looking at the COTA website (bus system in Columbus OH) this morning for possible bus routes to work after I move next month. If I am no longer driving everyday I sure would prefer not to pay insurance.

+1 screw the man mod points!

To answer your question.. (1)

CdBee (742846) | more than 10 years ago | (#10033784)

"Are people really prepared to let insurance companies track their every move to save money on car insurance?"

No.
Not on your nelly.
I hope that's clear enough.

McHealth Plan. (0)

Anonymous Coward | more than 10 years ago | (#10033787)

"Are people really prepared to let insurance companies track their every move to save money on car insurance?""

How about a health monitoring system? Every time you eat at McDonalds, your health insurance goes up.

That's great! (1)

Duke Machesne (453316) | more than 10 years ago | (#10033793)

Hack your way to lower premiums!

This just seems like a bad idea. (1, Interesting)

Anonymous Coward | more than 10 years ago | (#10033800)

This puts the insurability of you and your vehicle in the hands of the insurance company and their computer systems.

At least under the current method, you can be pretty much assured that you and your vehicle are insured wherever you go and, for most purposes, for whatever happens.

Under a computer-based GPS method, what happens if the insurance company institutes no-insured zones - those areas of highest risk that if you choose to travel through them you do so at your own risk?

Or, what happens if you have an accident, and your black box communicaates with the others black box, and they both contact the insurance company and the police regardless of whether you wanted them to?

Or, what about when you submit your claim and the insurance company shows that there is no record on their computers of any report from your car or its GPS that you were even in that area, or involved in an accident - conveniently deleted, or otherwise?

Personally, I like the idea of just signing an insurance contract where I know the umbrella coverage will follow me no matter what. I like the freedom of submitting my claim or not. And I like the fact that they're obligated to pay once I do.

You ask (1)

nanoakron (234907) | more than 10 years ago | (#10033802)

Question: "Are people really prepared to let insurance companies track their every move to save money on car insurance?"

Answer: Yes. People are stupid and short-sighted.

Privacy invasion not necessary (2, Interesting)

Waffle Iron (339739) | more than 10 years ago | (#10033804)

Technically, it would be easy for them to download their rate calculation code into the black box as an applet, have it compute the customer's rate for the month, and upload nothing but the final dollar amount.

However, for some reason it seems highly unlikely that they would ever do it this way.

People are really cheap (1)

memco (721915) | more than 10 years ago | (#10033805)

"Are people really prepared to let insurance companies track their every move to save money on car insurance?" Yup, as long as it saves 'em money, they'll try anything.

Um... (1)

rokzy (687636) | more than 10 years ago | (#10033807)

So, you work out how safe I was after the fact?

How about if I don't crash, you assume I was completely safe and don't charge me anything?

No? Oh, I bet you just want to use this to make me pay MORE?

Sigh... another dupe (0)

Anonymous Coward | more than 10 years ago | (#10033809)

This is just a repeat of a story http://yro.slashdot.org/article.pl?sid=04/08/10/16 49252&tid=158&tid=126 [slashdot.org] from last week. Since nothing is likely to be said here that wasn't said before, all you lurkers may as well read that one instead.

Total cost: cheaper? (2, Insightful)

Neduz (713874) | more than 10 years ago | (#10033813)

first rule: Companies exist to make profit. Making things cheaper doesn't mean more profit (only in special scenarios). The "cheaper" for some, will most likely result in a lot more expensive for others (and everything added up: a bigger profit for the company).
Second thought: Installing such things in each cars is going to cost money. How will such expenses make insurances cheaper?

Where does it stop? (1)

jokach (462761) | more than 10 years ago | (#10033814)

Say I get on this plan, and my rate goes through the roof because I either drive too much, too fast, too far, or whatever criteria they use .. when I switch back to the flat rate plan, I absolutely guarantee they will use my own 'data' against me in determining my flat rate plan when I switch back.

Where does using this data stop .. and in the end, would I really be saving money or stamping myself as a high risk driver for life?

The problem is... (0)

Anonymous Coward | more than 10 years ago | (#10033821)

The problem is that this is the stealthy way that a highly invasive monitoring system gets introduced to society. Like CCTV, it's introduced for 'your benefit'. Just like CCTV it will gradually become standard and expand far beyond it's original purpose. I imagine not too long into the future it will be very hard to get insured without a tracker fitted to your vehicle.

Then whats the next step up from there? RFID embedded on to your name badges to ensure you are taking proper breaks and are an efficient worker? House security systems show your teenager is bringing a boyfriend home during the day? It starts with technology that seems helpful but will gradually grow to erode privacy. Not just the privacy from the Government, but our privacy from each other. A world without secrets would be a very boring world indeed.

Old and busted: Portland Gas Tax (0)

Anonymous Coward | more than 10 years ago | (#10033822)

http://developers.slashdot.org/articles/03/06/03/1 715257.shtml?tid=158&tid=99

the thing that really bothers me... (1)

tuxette (731067) | more than 10 years ago | (#10033827)

...is that people have to choose between privacy and other rights and saving a few dollars/quid/whatever.

One or the other. Not both.

Yeah (1)

bool morpheus() (689231) | more than 10 years ago | (#10033828)

But does it run Linux?

Bad idea (5, Insightful)

bobetov (448774) | more than 10 years ago | (#10033839)

My wife and I were discussing a different take on this concept a couple of days ago, and came to agree that this kind of thing is a *bad idea*.

Our conversation was about health care premium reductions for opting out of "maternity" services. But I think the same arguments apply here. Basically, this kind of system defeats the core purpose of insurance; namely, to share risk.

There are times when charging more for a given behavior makes sense (eg quitting smoking) and times when it doesn't (eg driving in safer neighborhoods). Basically, given that people for the most part can't choose where they drive, this amounts to a violation of the risk sharing priciple. It doesn't drive down overall premiums, simply shifts those premiums to an unlucky subset, while getting others a break the didn't earn.

And of course, the system is designed to encourage safer driving, but we already have that in the form of accident reports and moving violations, which bring up your premium dramatically when you commit them.

I don't want to see a system where the rich folks get lower premiums due to driving in suburbs, while urban drivers get nailed. It leads to that insurer ending up with safer drivers overall (as the higher premiums for those in Compton drive them out of the insurance pool). In fact, in most cases such preferential insuring is actually illegal.

You can't accept only low-risk drivers as an insurer, because doing so breaks the risk-sharing concept that underlies the whole system.

Simpler approach...gas tax for insurance (1)

kawika (87069) | more than 10 years ago | (#10033841)

I know this is heresy for a technology site, but why allow all this privacy-invading electronics in the car if we could do it much more simply with a gas tax [consumerwatchdog.org] ? Sure it's not perfect but it doesn't require any extra technology costs and it eliminates a lot of overhead from the current system.

Insurance Rate by Route?? (1)

sciop101 (583286) | more than 10 years ago | (#10033842)

Win-win for the insurance companies!

As drivers change their habits and routes, cheap "safer" routes will become congested and accident-prone. Rates will increase on the new routes and old routes will stay expensive.

People will do it (1)

SteWhite (212909) | more than 10 years ago | (#10033850)

Are people really prepared to [insert giving up of x privacy or y civil liberties here] to save money [...]?

Sadly, the answer is yes. I think most people would care much more about their money than their privacy.

Less greenhouse gas emission (4, Insightful)

presidenteloco (659168) | more than 10 years ago | (#10033855)

I'm surprised that in 35 posts no one has mentioned that pay-as-you-drive insurance would tend to decrease driving, and so would help reduce greenhouse gas emissions, global warming, and urban air pollution.

These would seem to be the major benefits of this
idea by far, in the grand scheme of things.

Also. There's no need to track everywhere the car
goes in Orwellian fashion. All you need is a new
design of tamper-proof odometer that can be read
once a year when you renew your insurance.

the good news.. (0)

Anonymous Coward | more than 10 years ago | (#10033858)

is u can save a whole lot of money by switching to geiko,,

bad news.. the lizard gets to come with...

Some benefits of this scheme (1)

Odds (3533) | more than 10 years ago | (#10033862)

This idea has been floated around for a while, and is expected to have big benefits for certain groups of drivers. The two biggest beneficiaries are likely to be 1) students and 2) the poor.


There is (unsurprisingly) a high correlation between total miles driven and number of accidents. Right now, your insurance premiums don't account for this at all. The BBC article focuses on the GPS effects of pay-as-you-drive (PAYD), such as charging for types of motorway, time of day, etc., but the really big deal is just knowing the total number of miles driven.


So how does this help students, or the poor? Well, those two groups typically meet two criteria: high risk, and low financial resources. For these people, there are real benefits to being able to reduce their premiums which they can do by reducing the miles they drive. Right now, if you're a high risk driver, you're SOL - you pay the high premiums and suck it up. With PAYD, you can at least drive less, and still gain the benefits of having a car without breaking the bank.


(As a side effect, PAYD could help to encourage more sustainable modes of transportation, by making transit/walking/etc. more attractive relative to driving.)


If you're interested in these issues, check out this article: Pay-as-you-drive pricing for insurance affordability [vtpi.org] by Todd Litman.


One interesting note from the article: the reason poor drivers pay more as "higher risk" drivers is geographic. Insurance companies rank poorer neighbourhoods as "high risk", but not because poor drivers are more risky in their behaviour. No, it's because rich neighbourhoods tend to have more underused (second or third) cars, which are very low risk, lowering the risk of the entire neighbourhood.


And I do agree with the many posts here complaining about the ripoff world of automobile insurance... it's insane how expensive it is, and how cruel those companies are!

True Pay as you go... (3, Interesting)

mrwilson (448945) | more than 10 years ago | (#10033865)

A true pay as go or 'those who drive more pay more' concept would be to pay at the pump. The states should add .10 (or whatever) per gallon to go to Liability coverage for all that drive. No more uninsured motorists. No high fees for those that only drive 200 miles per month. It may sound a little socialist but you'd sure see those SUV sales give way to Hybrids.

Ask the makers? (0)

Anonymous Coward | more than 10 years ago | (#10033870)

I recently had to design this very system as part of a project for my comp sci degree in York. At the end of the project, we had a presentation from IBM (who are making the devices for Norwich Union), where the team who had worked on it told us that by the end they were disgusted by the abuse of privacy that could be achieved using this GPS-driven monitoring system.

Incidentally, they also told us they had to break several rules set as part of the project, such as using only volatile storage and having the device's power decided entirely by whether or not the keys were turned in the ignition. For your information, the data is retrieved using a transmission via GPRS from a system running inside a Java VM under Linux.

Pay at the pump (0)

Anonymous Coward | more than 10 years ago | (#10033885)

There has been a less-technology-reliant and privacy -friendly alternative discussed for years. It is called "pay at the pump" insurance. The basic notion is that a state pools all motorists and seeks an insurer willing to underwrite the entire state at a bulk rate. Then the penny a gallon cost is added as a tax at the pump.

Why is it attractive? Because if you drive, you are insured because you buy gas. Conversely, if you don't drive, you don't pay.

Texas, where I live, has a HUGE problem with uninsured motorists. It is a very significant portion of my premium (I could look it up, but for drama purposes lets say it is 50%... which is close). By bundling the premium with the gas, you instantly eliminate uninsured motorists.

I can imagine all sorts of social benefits as well. Drive a fuel efficient car, you pay less. Drive a huge SUV (like I do), you pay more. I won't feel as bad running over the electric cars, because I've paid my fair share.

Others have identified issues, like electric cars not paying at all. Risky drivers don't pay a proportionally large premium like they should. Motorcyclists pay very little while being extremely noisy^B^B^B^B^B risky. Basically, I don't care about those things because my premium would be cut in half or more.

As far as I can tell, the idea was defeated in the early 90s by the insurance and trial-lawyer lobbies.
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