Test By Insurer Monitors Driver’s Location
|By Becky Yerak, Chicago Tribune|
|McClatchy-Tribune Information Services|
That could be about to change.
Pratt explained that some routes or areas can be riskier than others. Making numerous left turns while driving close to home, for example, can be potentially more dangerous than, say, a straight-shot drive to the airport, he said.
Consumers have long been wary of insurance companies monitoring how they drive, as well as about privacy issues. This latest step could pave the way for insurers to use location tracking to raise insurance rates for people who drive in riskier neighborhoods -- those with either higher crime or higher incidence of accidents, said
"You may not want to live and drive a car in a high-risk area, or use routes that Progressive gauges to be more dangerous than a suburban drive for groceries, but you might not have any alternative," Lane said.
Lane said Progressive's testing also raises broader issues.
"We continue to generate vast quantities of increasingly granular information about our lives, and an endless number of entities and organizations are both recording and mining that data," he said. "We don't have a good idea of how it will be used, either now or in the future."
Currently, drivers who use Progressive's Snapshot monitoring device get discounts if they don't drive long distances or don't drive during periods of the day when there tend to be more accidents. Snapshot also benefits drivers who do little hard braking.
Progressive's testing of location tracking comes as younger people are more comfortable publicly sharing personal information on social media and might be less concerned about privacy issues involving location tracking of where they've driven. Progressive and other insurers have also assured policyholders that the devices won't be used to penalize them, only to reward good driving behaviors.
"If we decide to include location data in a future product version, we'll let customers know before they sign up," Pratt, Progressive's general manager of usage-based insurance, said in an interview after his remarks at the auto show's
He also noted that adding location tracking would increase Progressive's cost of monitoring and data transmission.
"So we won't add it unless it provides enough benefit to offset this added cost," Pratt said.
Progressive, aware of privacy concerns, has said it doesn't share data with third parties unless ordered to do so by courts.
The association of nonprofit consumer organizations has long opposed insurers using such factors as credit scores, education and occupation to influence rates, because it believes those have little to do with someone's driving ability.
In contrast, insurers using mileage as a rate factor is relevant and helps lower-income people, said
Hunter said that whatever data the device collects should be fully disclosed to the policyholder.
And "people must maintain the option to participate or not, since privacy is a very individual thing," Hunter said.
Policyholders using Snapshot account for annual premiums of about
Consumers who sign up for Snapshot plug the device into an onboard diagnostic port near the bottom of the dashboard.
"Insuring a car garaged in
"It's important to note the In-Drive device our customers put in their vehicles does have GPS capability, as does
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