Big Brother Car Insurance Companies: Should You Let Your Insurance Company Track Your Driving Habits to Earn a Discount?

By Dean I Weitzman, Esq. on November 23rd, 2011

Maybe it sounds like a great idea – plug a device into your car that let’s your insurance company see that you are a good driver so that you can get an additional discount of up to 30 percent on your insurance rates.

But before you sign up, think again. Maybe it’s a deal with the devil that you are considering.

That’s the concern we have with the Snapshot Pay-As-You-Drive program from Progressive Insurance. Progressive, the company with all those fun and friendly TV ads featuring the perky saleswoman, Flo, offers Snapshot as a way for drivers to allow the company to track some of their on-the-road behaviors so the company can see how safe their driving is around the clock.

Progressive calls Snapshot “a type of usage-based insurance,” according to its Web site. Once you enroll in the optional program, the company sends you a small electronic module that plugs into your vehicle’s computer diagnostic port, which is usually under the dashboard.

Once plugged in, you drive normally and the device collects data about your driving – a “snapshot” – for the company. So what is it collecting? Progressive says that the device only records the number of miles you drive, the time of day when you drive and how often you stop suddenly in your vehicle. It also collects your vehicle’s identification number and keeps track of whenever the device is plugged in or disconnected from the vehicle. The driving behavior that can lead to lower rates includes gentle braking, driving fewer miles than the average driver in your state and minimizing the time you spend on the road during high-traffic periods and during early mornings between midnight and 4 a.m.

The company’s Web site insists that Progressive won’t use the information to raise your rates. It also states that Snapshot does NOT include a GPS, or Geographic Positioning System, component. That means that it can’t record where you are driving or if you are driving over the speed limit, according to the company. “People who drive less, in safer ways and during safer times of day could get a discount,” the Web site states.

And if you change your mind and want to opt out of the program, the company says you can drop out at any time with no penalty and that your collected driving data won’t be used to determine your insurance rates.

So what’s the catch?

The scary thing is that if the technology inaccurately produces data to the insurance company, it could potentially be used against you.

Progressive says it won’t use the information to increase your rates, but the question is, do you believe them? Is it even possible that an insurance company that offers a device like this could ever use such information against you?

What if insurance companies would use such information, despite their assurances, to drop you from coverage based on your driving practices?

If such a situation could ever arise, then handing over your driving data to someone else – where it is out of your control – may not be such a good idea.

Right now, this is a driving monitoring program offered only by Progressive. But what if other insurance companies started offering it in the future? What if they potentially began requiring the use of such a device to have insurance coverage? Could they actually march down such a path? Could such a thing happen if consumers popularize the use of Snapshot from Progressive?

No one knows the answers to these questions today, but they are at least worth considering. Your rights to privacy and due process are at stake here.

Yes, you could perhaps save money by allowing an insurance company to record such information about your driving, but before signing up for such a program, be sure that you know what you are getting into.

It certainly brings up a myriad of other legal issues.

What if another driver, who is insured by Progressive, hits your vehicle in a crash and they are using the Snapshot device. Could your attorney subpoena such records and could they be used against the other driver if it shows that their driving caused the crash?

Actually, according to Progressive, yes, such a scenario could happen.

“We will not share Snapshot data with any third parties unless it’s necessary or appropriate to service your insurance policy, prevent fraud, perform research, or comply with the law,” the company’s Web site states. “For example, Snapshot data may be disclosed when we’re legally required to provide Snapshot data, such as in response to a subpoena in a civil lawsuit or by police when investigating the cause of an accident.”

That could be getting very dangerous for drivers. It sounds as though you could be giving up some of your important legal rights all for the sake of a few saved dollars.

And that is not a bargain at all.

If you are ever involved in a vehicle crash with a driver who is using such a device, be sure to discuss the matter with your attorney. If this is something you’d like to discuss with us here at MyPhillyLawyer, we are here to help you.

When Winning Matters Most, call MyPhillyLawyer.