You may have seen in the news recently that insurance companies are offering discounts to drivers based upon their driving habits. Some companies offer a device that plugs directly into the vehicle. However, lately companies are developing applications (apps) which can monitor the speed, smoothness, distractions, etc., by using smartphone data. This requires leaving your location services on continuously in the app. For the “best” drivers, discounts up to 30% have been offered.
While the idea of a discount in your car insurance bill (especially in Nevada) may be enticing, there are a number of potential issues which may arise. First, while you may be entitled to discounts for your “safe driving,” it is also very possible you could lose discounts based upon the amount of time you spend behind the wheel. Likewise, for every misstep you will likely be penalized – even if it does not result in a claim being made. At the end of the day it is imperative to appreciate that insurance companies are in the business of making money. Like any corporation, their goal is to maximize profits. There is every reason to believe the information gathered will be used not only to raise your insurance rates, but may also be sold to third-parties.
Yet a 2016 report by the Pew Research Center, based on a national survey and online focus groups, found that 45 percent of respondents considered trading a discount for surveillance of their driving habits “unacceptable.” It is likely unwise to provide any insurance company with this information. Ostensibly, if there were issues or problems with your driving this information could be subpoenaed in a lawsuit and used against you to demonstrate your driving habits. It could also be shared with subsidiaries who sell life or health insurance and may impact rates there as well. I can see no end to what “Big Brother” might do with the information you freely gave him in the hope of saving money on a short-term basis. Most of these apps are not available if you have had an accident or multiple moving violations. That being the case, the second you get into a car accident, the privacy you gave up would be wasted as you will never receive the promised discount.
Although these apps are relatively new, there are so many potential downsides to relinquishing your privacy that I think you would be unwise to participate. Until more time has passed and there are safeguards to protect your data and private information, keep your driving habits to yourself. An app isn’t necessary to drive safely and avoid car accidents. Look for savings somewhere else.
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