Many people have been telling me for years that they are a great driver! Well being that I can't ride with them everywhere they go, nor do I want to. Some of you all make me a little nervous behind the wheel! No joke everyone knows that one person that is kinda crazy! Back to the good drivers. Many of you say you are good drivers and now you can prove it! For years Progressive has what they call a Snapshot. Many other insurance companies have followed suit. This is all peaches and cream, but what does it mean and how does it save me money?
Snapshot and all the other devices are monitoring driver behavior through what they call telematics. Telematics is a usage-based insurance; it is the development of premium rates in part by monitoring the vehicle and the number of characteristics. The characteristics are:
A monitoring device is put into the car that measures and records the desired variables. The monitored variables are the combined with traditional rating factors such as claim history, driving record, vehicle make, model and demographics. Rates are set based on the combination of variables. Recording can be for a limited time or continuous. Limited recording is when the vehicle is monitored for six months, then the device is returned to the insurance carrier. Continuous monitoring is when the device stays with the vehicle and monitors continuously. Privacy issues are a major concern; some feel as though "BIG BROTHER" is watching and object to being monitored every time they drive.
Some equipment uses GPS to monitor location; this raises even more privacy issues, although it does provide better information for rating. With GPS the insured's locations are tracked. GPS can identify the types of roads the driver is on, posted speed limit, types of turns and other significant information.
Whether the vehicle spent 10 minutes going 30 miles on the highway or 30 minutes going 10 miles in heavy traffic is identified. Territory can tell a lot, but only if GPS is monitored.
Advantages to telematics are that it is fair and predictive, and you understand how it relates to rates. It is intuitive, while insurance credit scoring is not for many. It allows you to improve your driving for your own benefit; your rates are more tied to you specifically instead of a large demographic of similar individuals. Disadvantages include privacy issues, hacking concerns, cost to the insurance company of providing the device if it is provided for free, and storage of the data collected.
I hope that this answers many of your questions. Please feel free to Comment.
Many of you might be considering earning some extra money using a service like Uber or Lyft. These are some great ways to make a little green in your pocket here are somethings to consider and what they are.
With the Transportation changes, Ride-sharing is the practice of using your personal automobile to pick up someone and give them a ride to a specific destination for a fee. The potential driver signs up with a Transportation Network Company (TNC) such as Uber or Lyft that generally check the individual's background, driving record and inspect the vehicle. Once the person is approved as a driver POOF! That person is then allowed to sign into the app as a driver and can begin to pick up riders.
While at first this sounds like a great idea and a way to make extra money, there are many issues involved. These apps have some gaps that need to be addressed. Taxis and limousines are highly regulated services and believe that these regulations should also apply to the TNCs. States have concerns about consumers and drivers not being aware of the insurance issues involved and finding themselves not covered by insurance if an accident occurs.
Many of the concerns with ride-sharing center around the driver's lack of coverage on his personal auto policy when signed in to the app to look for a passenger. This makes the vehicle "for hire," which is excluded in most personal auto policies. Uber and Lyft provide contingent coverage during stage one; the contingency is that the personal auto policy denies coverage. While Uber's coverage is above state minimum limits, it still only covers up to $50,000 for bodily injury for an individual, up to $100,000 for bodily injury for everyone in the vehicle, and up to $25,000 for property damages, or as seen in the policy, simply 50/100/25.
Workers' Compensation becomes an issue as well; are the drivers independent contractors or employees of the TNC? This is still open to debate; TNCs often state that drivers are independent contractors using their own equipment and setting their hours, while drivers claim that the TNCs are providing work for the driver and are themselves providing a driver for hire. There are various suits by drivers claiming that they should be considered employees and not independent contractors.
This is an overview of some emerging technology that have already impacted many of us for the good and the bad! With new technology many things have not been addressed. When looking for ways to make extra money you want to make sure you are properly covered, this way all your hard work and time are not wasted. Please share your thoughts with us and let us know if you have any questions!
SPI Reflections Blog
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