Who's following you?
Insurance companies are offering discounts on premiums for those who use "pay as you drive" monitoring devices, but privacy advocates warn that consumers have no control over how their private data could be used.Note: Typographical errors have been corrected in the subhead from an earlier version.
The data-logging devices are placed under the dashboard to track driving habits. People who drive fewer miles, stay under 80 mph and don't do hard braking, accelerating or cornering could be eligible for cheaper premiums.
State Farm began offering "pay as you drive" at the first of the year, says agent Brian Conrad in Ashland. It's offered free with a 5 percent discount at the time of semi-annual renewal and will be used to lower rates but not increase them, he says.
After the first year, the device will cost $72 annually and would only make sense if it improves a customer's rates more than that amount.
"We're getting a significant response from our mailing to all customers," he says. "It allows them to figure out what they should be paying, based on their exact driving characteristics. People who drive lower miles will get a significant benefit."
The data-logging device is smaller than a cellphone and plugs into the same under-dash port used by the Oregon Department of Environmental Quality to check emissions. The port is available in cars made in the U.S. from 1996 on, according to the Oregon Insurance Division.
Customers can remove the device and drop the program at any time.
Data is transmitted wirelessly to a third-party vendor, who informs insurers of results. It is also transmitted to drivers' computers so they can spot red flags about their own driving.
The state is supporting the program with tax credits for insurers because it "rewards people who drive less and thus reduce the exposure to accidents, greenhouse gases and oil consumption," according to the Insurance Division website. It lists participating insurers, including Farmers, Travelers, State Farm and others. It also lists insurers who handle fleets.
"It's very popular," says Karen Townsend of Allstate in Medford, who also offers a 5 percent discount for using the device for a year. "It can take as much as 30 percent off your premium, as long as you don't drive over 18,000 miles a year and don't routinely drive between 11 p.m. and 4 a.m. weekdays and 11 to 5 on weekends."
Those wee hours typically see more drunken or sleepy drivers, she says.
"I absolutely recommend it," says Townsend. "It's good for young drivers, so they and parents can go on computers and see how they're driving. It also allows older drivers to see how they're doing" and whether age is affecting driving.
"My daughter used it and it was a good tool to talk to her about her driving. The data goes to parents," said Joe Hubband of Protectors Insurance in Medford. His carriers, Progressive and Safeco, offered it but Safeco discontinued it, he says, because of expense and lack of interest.
The devices are "very helpful to businesses," he adds, as they can track the time-on-site against time charged and see whether drivers are following the rules of the road.
Motorist April Delbrook of Ashland accepted Progressive's offer to install the device for a few months, then was asked to mail it back to them.
"I don't remember how much I saved, but it seemed significant," she says. "I just felt a bit weird knowing that they could track me, but was really happy my safe driving was actually rewarded."
Conrad says State Farm's data-logging devices, called In-Drive, track location only within a 40-mile radius.
The Insurance Division does not regulate what data may be collected or what it can be used for, says division spokeswoman Cheryl Martinis. The state also has no regulations barring insurers from mandating the devices or prohibiting insurers from selling data, she says.
"We look at their formula for determining rates and we make sure every part makes sense" as far as drivers' skill and safety, Martinis says.
With 130 insurance companies, Oregon is a highly competitive market, and if any insurer required the device or inappropriately tracked behavior or sold data, "it would be very anti-competitive ... and might become a question for the Legislature to deal with," she says.
Insurers are aware of concerns about loss of privacy from data collection, but Brad Hilliard, State Farm's public affairs director in Portland, says his corporation — and its third-party data vendor — pledge not to re-market the information.
But it can be shared with police, he says, such as when they're searching for a stolen vehicle.
"If law enforcement requests it, we have to share that information," he says. "They would go to the third-party vendor."
Fears about the "Big Brother" factor are not unfounded, says data privacy researcher Andrew Blumberg of the University of Texas at Austin, in a phone interview.
"You optimistically hope they're not tracking your location and are deleting data after a period, and that they would only release it for criminal proceedings and that they won't pack it up and sell it," Blumberg says. "But the fact is, you don't know what the corporation is going to do with it. It's all copied silently.
"By just knowing your miles, acceleration and braking, you can recover the path traveled and guess where you drove. ... They already have your age, gender and other data. The idea of being monitored — like what if they can see you go bowling and they decide they're not comfortable with bowling and that enters into their risk and profit calculations?"
The data can portray more than driving behavior, says Paul Stephens, of the Privacy Rights Clearinghouse in California, in a phone interview.
"It can indicate social behavior," he says. "Driving at odd hours indicates going out drinking. You are able to reconstruct social behavior. Information can be made available in civil proceedings and by law enforcement. It would be an invasion of privacy. It may start out sounding benign, but it's a slippery slope.
"Once you have a system for information collection, it becomes more invasive. Insurance regulators someday could require it."
John Darling is a freelance writer living in Ashland. E-mail him at firstname.lastname@example.org.