Auto Insurance Rates Driven by Data
Sunday, January 30th, 2011Surprisingly, over half of respondents to a recent survey from LexisNexis Risk Solutions, believe that auto insurance rates should be driven by actual driving data obtained through ob-board devices monitoring how someone drives. According to the article “Survey Shows Mixed Views of Data-Driven Auto Insurance Rates” by Ben Zitney on onlineautoinsurance.com, privacy concerns are holding back consumers from accepting auto insurance companies’ desire to collect information directly from the vehicle to set rates.
The monitoring device placed in the car can detect a variety of information such as speed, mileage, and braking data. Most auto insurance companies already use personal information like ticket history and credit history when determining rates, but this might take the privacy issue over the edge. The use of these devices is getting more and more common and could eventually be the norm.
GMAC has been collecting data from OnStar devices for some time now and having great success with their information gathered. Since 2008 Progressive has been offering discounts to policyholders who agree to have the devices placed in their car for monitoring. They measure information such as speed, braking, times of day driven, and distance traveled. Allstate announced that they have launched a similar program called Drive Wise to use data when calculating auto insurance policies. Compare auto insurance options to see if this might be something that could save you money in the long run. If you’re a good driver but haven’t proven through your driving record, this could be a plan for you.
