You may be familiar with the plug-in devices insurance companies offer to enable you to earn lower rates through safe driving. It’s a simple idea – you plug a small device into the OBD-II port in your vehicle, and it tracks all of your driving information, including speed and trip distance.
What you may not be aware of is that most insurance companies now offer mobile apps to track your driving.
Distracted driving is an epidemic that causes frequent and severe accidents, and in addition to costing lives, it’s costing car insurance companies significant sums of money they are reluctant to pay. Mobile apps that track your driving are the car insurance industry’s latest idea to reduce the number of motor vehicle accidents caused by distracted driving and, as a result, reduce their costs.
While every car built after 1996 has an OBD-II port, those devices cannot track how often you use your cell phone while driving. Mobile apps, however, will reward you with a high score based on how still your phone remains while you’re driving. The phone’s GPS, gyroscope, and accelerometer are used to rate your driving.
WHAT’S YOUR INSURANCE PREMIUM BASED ON NOW?
Currently, an insurance company uses factors such as your credit score, how old you are, the kind of car you drive, and where you live to decide what premium you should pay. If you get in an accident or get a ticket, your rates will go up. Using plug-in devices or mobile apps to track driving habits provide the insurance companies the opportunity to create more customized insurance policies and premiums for their customers.
THE PROBLEMS WITH MOBILE APPS
While these apps sound good – especially to people who consider themselves safe drivers – there are many downsides. First, there’s the privacy issue. Granting your insurance company access to your phone’s GPS allows it to not only see how long you were driving but exactly where you went and when.
Second, there’s an accuracy issue. The insurance companies claim that the app can detect distracted driving. However, if your phone simply falls off the seat, or if you hit a rough pothole, you can be docked points since the app can’t tell the difference between it falling off the seat and you picking it up to take a quick selfie. Maybe docking your phone in your car would solve that problem, but that’s just another piece of hardware we’d be forced to buy.
While we can hope that these apps will result in safer driving, it is more likely that the insurance companies will use them as an excuse to raise your premiums and increase their profits.
Judging a driver based on actual driving habits may be a good idea if it causes people to reduce distracted driving and improve their driving habits. Unfortunately, today’s mobile apps are far from perfect and there is no evidence that they actually improve safety.