Auto insurance adjusted for driving habits

Since early December, State Farm Insurance has been offering Wisconsin residents the chance for deep discounts on their auto coverage, if they agree to let the company, in effect, ride shotgun.

State Farm says the program, dubbed Drive Safe and Save, allows for a more accurate calculation of risk, by way of a small device added to a vehicle’s diagnostic port that tracks real-time driver behavior. Factors such as speed, mileage, lane changes, location, time of day and braking urgency are measured.

Drivers who participate in the program get a 5 percent discount immediately, and then are eligible for further cuts of up to 50 percent after six months of monitoring, depending on what the record shows...

“This is just a way for us to set better rates for customers who are good drivers,” said Missy Dundov, spokeswoman for the Bloomington, Ill.-based insurer. “This program is a chance to get discounts.”..

Other insurance companies, including Progressive and Allstate, offer similar versions of driver-monitoring programs in at least some states...

Erpenbach said he wasn’t surprised to see insurance companies trying to monitor people’s driving practices, but he questioned where it would all end.

“If I’m State Farm, sure, I want to know about any driving habit of my policyholders,” he said. “I would also love to know, if I’m State Farm, what everybody does in their houses (for home insurance purposes). And I’m sure health companies would love to see people’s grocery lists.”

I have heard concern expressed that if the insurance company has access to detailed information on your driving, they might deny a claim based on data they extract.