Many car insurance companies offer good driver programs that reward drivers with lower insurance rates if they permit the company to monitor their driving habits. While such programs provide benefits such as lower rates, there are also drawbacks, including privacy concerns and possible negative impacts on insurance claims. In this article, we will explore what car insurance tracking entails and the risks associated with using tracking devices.
Usage-based insurance (UBI) programs are now offered by most auto insurance companies. Participants receive equipment to track their driving habits in one of two ways: (1) a device that plugs into their car’s onboard diagnostic (OBD) port or (2) a smartphone app. Some newer cars are pre-installed with tracking devices. Insurance companies can collect data on drivers’ habits through any of these methods. If the insurer’s metrics indicate safe driving, participants can enjoy discounted insurance rates.
The following information can be gathered by a typical auto insurance tracking device:
- Driving speed
- Braking and accelerating habits (e.g., hard braking or rapid acceleration)
- Turning habits (e.g., hard cornering)
- Frequency and duration of driving
- Daytime or nighttime driving
- Phone use while driving (smartphone apps)
Many leading car insurance companies, including Geico, Allstate, Liberty Mutual, Nationwide, and Farmers, offer these programs.
It may be of interest to know whether one’s car insurance company can track their car. Good driver or UBI programs are voluntary, which means that insurance companies can only track a participant’s vehicle if they opt into the program. Participants can also opt out if they no longer wish to participate. However, opting out may lead to increased insurance rates.
There are two main risks involved in using an auto insurance tracking device. The first is that it can compromise a participant’s privacy. Allowing an insurance company to collect data on driving behavior reveals private information about one’s life, such as their whereabouts on specific dates and times, and whether they routinely exceed speed limits. Furthermore, if an insurer uses a smartphone app to track driving, it may continue collecting data even when the participant is not driving. Ultimately, participants must decide how much personal information they are comfortable sharing with their insurance provider.
The second risk is that driving data can be used against participants. For instance, if a participant files a claim with their insurance company following an accident, the company may use tracking data to deny or reduce their compensation. If the participant is involved in a lawsuit related to an accident with another vehicle, the other party’s attorneys may request tracking data from their insurance company and search for information that can be used against them. Conversely, tracking data can also help a participant’s case when they file an insurance claim. If the participant is involved in an accident-related lawsuit, their attorneys can use the tracking data to demonstrate that they were not at fault. In conclusion, car insurance tracking data can either assist or hinder a participant’s insurance claim or legal case.
Can insurance tracking devices harm one’s vehicle? Certain insurance tracking devices have been accused of causing damage to vehicles, specifically by draining their batteries. Participants are advised to consult their insurance provider regarding any potential risks associated with using an insurance tracking device.
