Willing to let your
car insurance company
ride shotgun for a chance at a discount? That's the idea behind
Progressive's Snapshot program.
"This is a new approach to auto insurance. It allows you, the
consumer, to share your driving to get a discount," says Richard
Hutchinson, Progressive's general manager of usage-based insurance.
"And it's a purely voluntary program. So you don't have to do it if
you don't want to."
After it's plugged into the computer system (most vehicles
beginning in 1996 have the required diagnostic port), the Snapshot
transmitter device monitors time of day and vehicle speed, how many
miles are driven and the frequency of hard braking. It also reports
if the device is disconnected.
The idea is simple: Drive carefully and save. Drive less, save
more. And if you avoid driving during peak accident hours
(Progressive says that's between midnight and 4 a.m.), then save
some more. The device must be installed for at least 30 days, with
the option to leave it in longer for a broader profile and perhaps
a bigger discount. The company claims that as much as 30 percent is
possible.
Consumer concerns about 'Snapshot'
Progressive says that the worst outcome from installing Snapshot
would be failure to qualify for an additional
car insurance
discount.
But some skeptics wonder what Progressive will do with the
information the electronic eavesdropper gathers. They worry that
rates may actually go up if they don't drive well or that their
privacy could be compromised if the information is shared with
others.
Marc Rotenberg, the executive director for the Electronic
Privacy Information Center (EPIC), says his group hasn't looked at
the Snapshot program specifically, but it has concerns whenever
information on consumers is gathered.
"We'd be concerned that (gathered information) could be shared
with third parties" that could compromise the driver, Rothenberg
says. Another privacy concern with such programs is that the
information could be used in advertising targeted at consumers or
shared with the police in driving-related investigations.
Some potential customers share the suspicion that blind pursuit
of the
cheapest car insurance
could backfire.
Here's a typical comment, from "Wildblueflyingbear" at
SlashGear's
Snapshot forum
: "(The) program probably had relatively benign intentions. But how
can large companies and the government possibly leave it there?
There is too much opportunity for mischief if we blindly give up
privacy rights just to get a rebate check. It might work well now,
but later on you could (regret) the day you first saw Progressive's
commercials."
Progressive's website directly addresses those worries.
"No, Snapshot won't increase your rate," the company states,
adding that "we won't share Snapshot data with a third party unless
it's required to service your insurance policy, prevent fraud,
perform research or comply with the law. We also won't use Snapshot
data to resolve a claim unless you or the registered vehicle owner
gives us permission."
Hutchinson adds that Progressive can't track where you drive
because the device does not include GPS technology. The worst that
can happen, he claims, is not qualifying for a discount.
A Snapshot snapshot
Those assurances were enough for William Parsons, who recently
participated and came away with almost a 15 percent rate cut. "I
didn't have any hassles," says Parsons, who lives in New York.
"After a week or so I kind of forgot that it was in there."
Parsons, who has a 2005 Honda Accord, says he was optimistic
about the results because he fits the profile of a driver who would
qualify for a premium cut. "I'm pretty anal when I drive. Slow and
steady, 10k miles a year."
Parsons adds that he wasn't "overly concerned" about the company
having a detailed report on him.
"If I was a bad driver, I'd probably feel different," Parsons
says. "But I wouldn't sign up" if that was the case.
In fact, Progressive recommends that only careful customers who
don't drive much, or at least avoid peak accident hours, should
sign up.
Easy on the brakes
Although generally satisfied, Parsons says the brake monitoring
seemed inconsistent. "There were trips where I know I didn't brake
hard but it showed that I did. (Other times) I think I did hit them
a little hard, but I'm not sure if they registered. Not really a
big deal, in the end" because he still got the discount.
"Linda Foss," a poster at SlashGear, also had braking issues. "I
just connected it 2 days ago and was shocked by the number of hard
brakes it recorded," she wrote. "Apparently, by 'hard braking' they
mean using your brakes. I coast to most stops. But I do tap the
brakes before pot holes and road patches the size of speed bumps. I
am still hoping for a good discount as I do not drive
much/far."
Progressive, however, stands behind Snapshot, saying all
monitoring information, including braking statistics, is
accurate.
Snapshot is currently available in 39 states, with plans to
offer it in more in coming months, the company says. You can find a
list of participating states at Progressive's website.
Hutchinson notes that Progressive has been fine-tuning the
program for a few years; it's seen as an improvement to the
company's MyRate program, which required a six-month enrollment to
possibly qualify for a discount.
"Snapshot is easier to understand" than MyRate, Hutchinson says.
"We know from our research that this version will be more appealing
because drivers can save money after just 30 days ... Plus,
customers only have to give us a snapshot of their driving for one
policy period, then they don't have to worry about the device
anymore."