High-Tech Monitors Help Safe Drivers Save on Insurance -- Journal 10 - August 3, 2008

http://www.cnn.com/2008/TECH/07/29/driver.monitoring.ap/index.html

Progressive Insurance Corporation has recently launched a new program to give its drivers the chance to lower their insurance premiums. High-tech monitors placed on vehicles at the owner’s discretion are now making it possible to monitor what time people drive, how far they drive, how fast they accelerate, and how many times they hit the brakes. Based upon this information recorded by monitors, drivers can either have their insurance premiums reduced or pay a surcharge.

The voluntary program allows the insurance company to monitor instances previously mentioned to determine whether or not the driver is a ‘safe driver’. Insurance premiums will be reduced by 10% the first year just by signing up, and if they meet safe driver criteria, their rates could decrease by 60% based on their driving patterns. If they enroll and fail to meet safe driver standards, drivers could end up paying as much as a 9% surcharge.

Although the monitoring system does not collect where drivers actually go, some groups do express a concern for privacy invasions associated with the system. They claim that once the data is projected to the insurance companies, it becomes theirs.

I personally do not believe this is a bad idea completely. Since the system does not track people where they go, I do not view it as an invasion of privacy. Also, people voluntarily sign up to enroll in the program, so nobody is forcing them to participate.

I also find it hard to set standards for driving. There are many unusual circumstances that happen that may not be in the driver’s control. For example, if a deer runs in front of you, you have no choice but to either stand on the brakes or hit the deer. Both choices result in negatives on the monitoring system. I would hope the system allows for a set number of uncontrollable instances before it begins tacking on a surcharge.

Progressive Insurance Company certainly is not the only company that uses monitoring to help create safe drivers. For example, in 2007, American Family Insurance Company began a Teen Safe Driver program that allows an installed camera to take pictures of the road and the teen whenever it detects a swerve, crash, or slamming on the brakes. It then e-mails the pictures to mom and dad. The program does not necessarily offer discounts for the teen drivers, but it does help to create safer, more cautious drivers on the roads.

Reference:
http://findarticles.com/p/articles/mi_qn4188/is_20070914/ai_n20508925