TomTom Satnavs To Set Insurance Prices 605
nk497 writes "TomTom has signed a deal with an insurance firm that will see its satnavs used to monitor drivers. Fair Pay Insurance, part of Motaquote, will use monitoring systems built into the TomTom PRO 3100 to watch for sharp braking and badly managed turns, rewarding 'good' drivers with lower premiums and warning less skilled motorists when they aren't driving as they should. 'We've dispensed with generalization's and said to our customers, if you believe you're a good driver, we'll believe you and we'll even give you the benefit up front,' said Nigel Lombard of Fair Pay Insurance."
I guess it's time to say "I told you so"? (Score:5, Interesting)
For all those of us who keep saying that this sort of technology will be abused, and all the folks that keep saying it won't - I guess it is our turn to say "I told you so."
My prediction, sales of this SatNav will plummet if people know that they will be monitored constantly.
Speeding (Score:4, Interesting)
And not to mention _speeding_! The Nav knows what's the speed limit at your location an instead of beeping when you overdo it, it will raise your premium each time, perhaps even rat you out to the cops.
What about external hazards? (Score:2, Interesting)
Most of the time sharp braking is for something which shouldn't be in front of the car,
if anything this sounds like it will reward drivers who aren't as focused on the road,
blindly running over pedestrians and driving dangerously slow to avoid "badly managed
turns."
The silver lining (Score:3, Interesting)
This is actually a really bad step down a steep slope, even odds within five years at least one state requires this to run a motor vehicle (or tries to).
But... I can see one possible silver lining in all this. Recording what the driver is doing, and see what the profile of a driver who actually gets into accident does might dispel some myths. For instance, if you get too many speeding tickets most insurance companies will raise your rates. But I have always been of the mind that people speeding are paying WAY more attention to the road than the average driver, and in the end probably are not as likely to get in an accident. Well, with these devices, now we would know...
Are GPS devices reliable for this purpose (Score:5, Interesting)
All privacy questions aside, are sat nav devices reliable enough for this purpose?
I purchased a TomTom device new within the last year. On complex intersections - and sometimes just on parallel roads - it can "snap" the car back and forth between pieces of roadway on the display. Sometimes it seems to think you're starting a turn you're not actually making and then eventually snaps the car back onto the correct road later. When exiting a parking lot it sometimes isn't certain about which direction you're really moving in until you've drove a little. It has also tried to direct me down a variety of local roads that don't actually exist. I imagine at least some of these issues are somewhat common among sat navs, and this is only part of my anecdotal experience with one device.
The point is, when these things become a significant input into insurance rates, who can actually inspect them and certify them for such purposes?
Re:The silver lining (Score:4, Interesting)
From police statistics it is proven that people that speed have a higher risk of accidents. It's a simple as that.
Even if you pay better attention to the road, the higher speed means less reaction time, longer braking distance, and generally higher speed the moment you actually hit something making damage worse. Also if you're doing say 100 km/h on a road with an 80 km/h limit, other traffic may easily misjudge your speed, and try to make a turn in front of you when there is actually not enough time to do so. Or they simply see you coming around the corner too late, and with your too high speed you do not have enough time to stop to prevent an accident.
Generalising: lower speed makes roads safer. Taken to the extreme to make the point: at walking speed not much can happen, and if something happens the damage is minimal.
hacking satnavs (Score:4, Interesting)
Re:I guess it's time to say "I told you so"? (Score:4, Interesting)
If it loses the signal, it's still got ignition and accelerometer to know you are driving. If you do a lot of driving with no GPS data, they're perhaps either going to send an engineer out to fix it, or up your premiums.
Why assume that if you can think of a potential way around it in 3 seconds, then the engineers didn't already think that one through? It's such a dumb assumption.
Re:The silver lining (Score:5, Interesting)
Are we already monitored enough? (Score:3, Interesting)
Similar insurance scheme was already tested in UK 7 years ago by Aviva. It was called PayAsYouDrive where GPS device would trace your route and your insurance will be paid based on your route and time of the day. This was designed for young drivers which insurance premiums are high. If they would drive during the daytime insurance would be lower compared to night time when most accident happen for young drivers.
There was a talk that government could use the same principle for charging us for using roads. In this case it would be compulsory for every vehicle in UK to have GPS. Different charge would be for different roads and different times. This would be used to stop people using main roads during rush hour and help road overcrowding. Obviously, the charge per mile of road during rush hours would be much more expensive and people would plan their trip after rush hour. Also they could use the same data for issuing speeding tickets too.
Would you like your country to start similar schemes or this is too much control?
Re:Competition ahoy! (Score:2, Interesting)
Alternatively, it becomes more expensive for bad drivers, and less expensive for good drivers, maintaining a zero sum shift in rates and profits. However, if bad driving behavior is of the type that can be reduced by what is, in essence, a sin tax, then the roads as a whole become safer, driving insurance payouts down. That savings may or may not be passed on to the consumer in some fashion
Re:Competition ahoy! (Score:5, Interesting)
The big problem motor insurers have always had is properly assigning risk - it's pretty obvious an 18yo male is more dangerous than a middle aged woman, but that's a statistic, not a cause. If you could find out what made the 18yo dangerous, you could charge for that instead and have fairer premiums for the rest of us.
Re:I guess it's time to say "I told you so"? (Score:2, Interesting)
It amazes me when I go to the store and they expect me to carry a "loyalty card" for a minor discount
Well, personally I dont see any harm in letting them know which brand of what product I purchase and getting some discounts for that
And anyways, buying habits (Atleast mine) are erratic enough that they would have a hard time establishing trends, other than a trend of erratic buying habits
Re:What about external hazards? (Score:5, Interesting)
Whether or not frequent sharp braking correlates to bad driving is irrelevant. All that matters is whether or not it correlates to a higher accident rate.
If the driver is bad, they'll brake sharply often. But even if the driver is good, if they are regularly surrounded by bad drivers, they'll probably brake sharply often. And guess what? In both cases they're more likely to be involved in an accident.
Re:I'll second that. (Score:4, Interesting)
You're forgetting the most important part. Insurance companies don't have to tell you how much of a risk you are calculated to be. So as long as they can convince some customers to pay more, the companies can afford to let some customers pay less.
Insurance isn't about charging people exactly how much they will have to pay out. It's about spreading loss costs over a wide populace. Risk calculation is important to make sure you're collecting enough premiums to cover everyone and to avoid grossly-overcharging low-risk customers (since they would eventually wise up and leave).
Besides, insurance companies don't make money off the premiums they collect. They invest the premiums and turn profits on the returns. It's the actuaries' jobs to ensure insurance companies don't take on so many high-risk customers that they end up paying out more than they are making on their investments.
Re:I'll second that. (Score:4, Interesting)
On many "insurance" items, I would tend to agree, but in the case of medical insurance and auto insurance, often the amount you would have had to pay out is much higher because the insurance company adjudicates it down. In reality, what we should be doing is to tell the insurance company to give us a good rate because we will pay for all the damage and all they have to do is send their lawyers to fight for us.
Re:Competition ahoy! (Score:5, Interesting)
Re:I'll second that. (Score:5, Interesting)
Jon, I've got a great deal of respect for your /. persona. You seem always reasonable even when I don't agree with you, and you've swayed me often. But here I think you've missed the general thrust. We're on a very subtle topic. The issue isn't "Insurance good/bad" or something that gross. It's about whether the pursuit of use of intelligence to understand the risks of a particular customer of insurance is a good thing, and the limits of that pursuit. That's a cloudy issue you seldom weigh in on, but I'm interested in your input if you will engage the question.
Re:Wow, /. has an actuarial constituency. (Score:1, Interesting)
And to me it's money well spent because in America today you can't get treated if you don't have insurance. Almost everybody gets sick now and then, kids break their arms or legs or whatnot, and to take them to the emergency room without insurance would cost me my house.
So don't live in the United Right-wing Republic of Invisible-penis-of-the-free-market-giving-the-99-percent-the-shaft-istan then.
Know how much it costs me to go to hospital if I get sick or break something? ZERO. FOREVER. Other than what I've already paid in taxes. And my country, and almost all other Western democracies, likes it that way.
Re:I guess it's time to say "I told you so"? (Score:5, Interesting)
Doesn't everyone realize the "tom tom pro 3100" won't be able to communicate without some sort of data plan? TomTom offers plans now that will send you traffic information based upon your location but there is a yearly fee for that information. [tomtom.com] Anyone want to pay to tell the insurance company you were going 10mph over today so your premiums go up? Didn't think so.
Having to pay hundreds for the device and then pay an additional fee for data is killing the stand-alone GPS market. Apps like waze [waze.com] provide GPS routing and real-time traffic information (including location of police speed-traps) for free, all you need is a smartphone. TomTom's grasping at straws with this press release, their market is drying up and they know it. Why pay $300+ and $60+ a year for something that's already free on your phone?
Waze even provides real time road updates by users. For example I can report an accident and the location is marked for other users to see live. TomTom's can't do that.
I have two TomToms. One's an older TomTom ONE and the other is a 5" TomTom XXL. I don't use either one, I use Waze.
Re:I guess it's time to say "I told you so"? (Score:5, Interesting)
no I wouldn't, and I shouldn't be liable for that either. see there's this thing called 'shit happens' in life and society needs to accept this instead of demanding a way to point blame every time something bad happens. that parent took a risk with his kid's life (and his own) just like I did when we all decided to drive somewhere. this risk is NOT mitigated by lawyers and business owners selling snake oil protection, then building 'optional' surveillance societies around their policy holders to insure max profits. it's dictated by physics, skillset, and awareness. the only risk that it does mitigate is the artificial/legal one threatened by the over litigious society which created it all in the first place because it has increasing trouble dealing mentally with risk.
if you want to mitigate your risk, learn how to drive properly and stay alert while doing so.. if you can't, get off the road until you can! if anything, insurance has a negative impact on this by creating a false sense of security because of how its marketed. you'd think people would be smarter than that, but these days I have my doubts.
Re:I guess it's time to say "I told you so"? (Score:3, Interesting)