California's Revised Pay-As-You-Drive Insurance Draws Continued Objections 411
The EFF has restated many of their original privacy objections about California's latest revision to the Pay-As-You-Drive auto insurance proposal. Admitting that the amended bill is an improvement, privacy advocates are still uneasy about the surveillance implications of this program. "The proposal centers on a simple idea: infrequent drivers are less of an insurance risk. By pricing policies according to the mileage driven, insurance companies can offer discounts to lower-risk infrequent drivers, and put an appropriate cost penalty on heavy drivers. The state estimates that 30% adoption of PAYD insurance nationwide would reduce miles driven by at least 10% among subscribers, and save 55 million tons of CO2 over the next ten years. The benefits of such a system could be quite dramatic, as California Insurance Commissioner Steve Poizner is sure to emphasize. Such insurance plans first became available in 2004, and are now available as a limited option in 30 US states from insurance companies like Progressive and Liberty Mutual."
Re:Bell curve??? (Score:3, Informative)
Re:Bell curve??? (Score:3, Informative)
How is someone who drives less better at driving?
Not better at driving. Less of an insurance risk. At one extreme end of the scale you have the person who doesn't drive at all - just leaves his car in the driveway. Almost zero risk. At the opposite extreme end you have people who spend most of their lives driving - almost certainly higher risk of being in an accident even if it's a freak accident that you can't really blame them for. I don't have the stats so maybe I'm wrong but it does seem likely that you can identify a class of low freqency drivers that are unlikely to have an accident because they spend little time driving.
Re:Bell curve??? (Score:5, Informative)
Why would his first 100k miles be any less risky than my first 100k miles? The risk of my first 100k miles will not be lessened by the fact that I intend to drive more in the future.
Therefore, unless I have zero risk of an accicident in my final 900k miles, my lifetime risks are higher than his, all other things being equal.
Re:I drive exactly as much as I need to (Score:3, Informative)
Because no provider offers a 100 minute plan. I use less than 100 minutes per month. At 10 cents per minute and $1 per day used I spend about $20/mo. I could get a LOT more minutes for $40/mo, but I don't need them.
Re:Bell curve??? (Score:3, Informative)
Re:Privacy? (Score:5, Informative)
I agree. Odometer checks seem far less invasive, and cheaper, than GPS. Also, already illegal to tamper with, while I can think of all sorts of ways to interfere with GPS tracking.
Re:I'm not sure I agree (Score:2, Informative)
Um, how is it weighted by relevent statics if the insurance company currently doesn't know the miles driven?
I don't follow you. My insurer knows how many miles I drive per annum (well, within a bracket) because I fill in the details on my insurance renewal every year. I imagine they perform at least some checking up on at least some people who get in accidents so as to make sure that the information is at least broadly true.
MyRate by Progressive (Score:4, Informative)
MyRate by Progressive (as mentioned in the summary) has been around for quite some time (in select states) and I am a longtime customer. Here is how it works:
You get a computer chip that installs on the ODBCII port on your computer. Every 6 months (when you renu your policy), you pull out the chip, plug it into your computer via USB, and upload the data with your policy renewal request. You can view charts of your driving speeds, times, etc.
Progressive then offers you a discount percentage off of your base premium. They have an explicit policy that utilizing this chip cannot INCREASE your premium, only give you the option of a discount (in other words, we overprice our policy, but give you an option to recoup it if you drive less)
The discounts are as follows:
5% = participation discount
5% = safety discount (stay below 75mph and the discount is yours)
up to 10% = based on driving time / milage.
The 10% is calculated roughly as such.
At the beginning of the tracking period, you are given a 10% discount. then for every mile you drive, that percentage is reduced by a fraction. That fraction (something around 0.0006% per mile) is determined based on the time classification you drive. they have 3 classifications of driving time, low, medium, & high. High are times such as rush hour, and overnight, medium are weekends & lunch hour, low is everything else.
Ultimately, with both the safety discount and the amount I drive, I end up with somewhere around a 16% discount off my policy renewal.
It can be compared to the california policy, but in reality the current offered program seems quite different from the proposal.
**Privacy** is the issue. (Score:5, Informative)
I've combed through the 108 comments so far that have been modded 2 or above, and not a single one of them shows any awareness of what the article actually talks about. Has anybody actually read the article? Oh, wait, this is slashdot...
The article helpfully explains that the main issue being raised by the EFF is privacy. Um, it's not exactly subtle...the article has a big image of a poster with a man's face, with the slogan "BIG BROTHER IS WATCHING YOU."
What the EFF is objecting to is the idea of using electronic monitoring to measure the number of miles driven. The article (remember that article thingie? it's got that little underlining thingie, with the text in a different color, so you can click on it, and it's, like, a hyperlink, so you can go and read it?) lays out some objections to this, such as the tendency the government has demonstrated since 9/11 to go nuts with intrusive monitoring of its citizens. The concern is that the government will then be able to tell where every citizen drives. That's pretty darn scary, if you think about it.
Re:Rush Hour? (Score:5, Informative)
NO! (Score:3, Informative)
Re:Oh crap. (Score:3, Informative)
One of the key points is that driving the city streets causes more accidents than driving the freeway.
I really doubt that people will avoid freeways like the poster says, though. I think the extra gas used, the time wasted, and the additional risk of accidents outweigh the small advantage in insurance costs.
Re:Bell curve??? (Score:3, Informative)
you know if they can get the statistics exactly right, then they could just charge people for how much they are going to cost. You WILL have 3 accidents costing $15k, $8k, and a $345 fender bender. Add all that up +profit and charge that. It would be the only way to be fair.
Re:Bell curve??? (Score:3, Informative)
I tried to ride a bike for the first time in a decade a few years ago. I could barely get it to go forward, much less straight. Balancing left/right was extremely difficult. I knew what I had to do, but my physical reactions were too rusty to actually perform those actions. So yes, you do forget.