Progressive was recently awarded a patent for technology that could be used to alert drivers that they are driving poorly, or even to send a text to a teen's parents warning them that their child is breaking some rules of the road.
The patent is the sixth granted to Progressive for its pay-as-you-go Snapshot plan, which provides car insurance discounts of up to 30 percent for motorists who qualify after having their driving monitored for 30 days by an in-car device.
Snapshot and other usage-based plans like it use a device to measure driver performance such as miles driven, time of day and braking.
Among other things, U.S. Patent No. 8,311,858 covers a wireless device that monitors vehicle data used to determine a level of risk, which factors into the cost of insurance. The patent also addresses an in-vehicle audio alert based on driving behavior data, which may lead drivers to change their behavior, Progressive says in a statement.
More than 1 million drivers have participated in the Snapshot program already, and if language in the recently granted patent is any indication, future versions could include some new features. Among them could be equipment that would let parents monitor teen driving behavior. If the teen speeds, for example, the device could transmit a text or call the parents to alert them. (See: "Is your car insurance going the way of the landline?") Or the device could alert parents if their teen wasn't wearing a seat belt.
The patent also outlines instances when automated alerts could help motorists in emergencies. The following events are examples of when the technology could be used to notify a "surrogate or central control center," according to the patent:
Other potential uses of the technology include:
Progressive did not respond to requests for comment on the patent.
Available in 43 states, drivers enrolled in the Snapshot program save an average of $150 per year, Progressive says. Snapshot was recently expanded to allow drivers to try it risk-free for 30 days to see if they'd save before signing up. (See: "As economy sinks, pay-as-you-go insurance soars.")
"Snapshot is a voluntary discount program in which drivers can save money on their car insurance by sharing a picture of their driving habits with Progressive," says Emily Donohue, a Progressive spokeswoman. "Snapshot is great for people who drive less, in safer ways and during safer times of day."
Some people may worry that data collected on their driving habits could cause their rates to increase. With Snapshot, the device collects data for 30 days before the company decides if a driver is eligible for the pay-as-you-go discount. "Drivers' rates are guaranteed not to increase as a result of Snapshot," says Donohue.
Critics, however, contend that people who have to drive long distances for their jobs or work the late shift are unfairly penalized against nabbing these discounts. Plus, they argue that drivers are giving up rights and privacy to get good rates. (See: "To save a buck, let your insurer be a 'Peeping Tom.'")
Jack Taylor, the Joseph S. Bruno professor of retailing at Birmingham Southern College, who teaches courses on insurance, isn't quite sure if pay-as-you-go plans are worthwhile.
What worries Taylor is the possibility that some people who sign up for the programs might be branded as risky if their driving data doesn't qualify them for the discounts. Perhaps those customers will walk away, from the programs, figuring no harm, no foul. But Taylor questions whether they run the risk of getting non-renewal notices from their insurers six months or a year later. (See: "3 things you don't know about pay-as-you-go insurance plans.")
At this time, Progressive doesn't currently non-renew customers based on Snapshot data, says a Progressive spokesperson.
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