from Great Game India:
According to The New York Times, your driving may be secretly scored as auto insurers increasingly monitor driving habits through data collection, impacting both insurance rates and privacy.
You are aware of your credit score. It may also be the case that you have a driving score.
Your driving habits, such as how frequently you brake hard, accelerate, use your phone while driving, or drive late at night, are all factored into your score.
You will find it more difficult to ascertain your driving score than your credit score. However, it is accessible to auto insurance providers, which may have an impact on your premium.
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Auto insurers have been attempting to encourage consumers to sign up for programs, also known as usage-based insurance plans, that track their daily driving to better reflect the risk associated with the policy for the past 20 years. However, customers who value their privacy have been hesitant to enroll.
Consequently, the industry has adopted a different strategy, obtaining driving behavior data from automakers or from apps that drivers already own on their phones. Most consumers are unaware that the insurance sector can follow them in this manner, according to experts.
Following the disclosure by The New York Times that General Motors was exchanging driving records with LexisNexis, numerous lawsuits were filed by customers, leading the automaker to terminate its agreement with the data broker. However, information is still being gathered from applications and other automakers.
Consumers may benefit more from driving behavior analysis, or telematics as the insurance industry refers to it, resulting in more equitable and customized pricing. Furthermore, if reckless drivers must pay a higher price for their actions, they might drive more defensively, creating safer roadways. However, this will only take place if drivers are conscious that their actions are being observed.
Customers consent to the data collection and sale companies sharing their information with the insurance industry. However, because of the hazy consent procedure, individuals might not be aware of what they are choosing.
As stated by Michael DeLong of the nonprofit Consumer Federation of America, “Most consumers are put off by the idea of an insurance company riding shotgun.”
Smartphone Apps
The smartphone apps that are gathering driver data might not be immediately apparent. One is Life360, which parents use to monitor their kids. MyRadar provides weather predictions. GasBuddy lowers fuel expenses for users.
Additionally, all of these apps have optional driving analysis functions that use motion and sensor data from the phone. If a family member crashes, you can activate these features to receive alerts and ideas for a more fuel-efficient route to work. However, the analytics firm Arity—which Allstate created in 2016—supplies those functionalities in exchange for payment for data access. When users sign up for the features, it’s not made obvious that Arity also evaluates how dangerously they drive for insurance purposes.
For example, users can enable a feature on GasBuddy called “powered by Arity” that ranks how fuel-efficient their drives are. According to company representative Brandon Logsdon, users must first “agree to Arity’s Privacy Statement before they can use the Drives function.”
However, this agreement is located beneath a large red button that says “Join Drives” in a little gray text. The brief disclaimer only states that by selecting “Join Drives,” you consent to sharing “particular information” with Arity and clicking the hyperlinked privacy statement. The wording does not define Arity or what it does.
Tens of millions of people’s driving scores are sold by the corporation. According to Allstate’s website, auto insurance firms can “request a person’s driving score, which is delivered instantly.”
According to a blog post by Arity directed at insurance marketers, the ratings “look at drivers’ performance behind the wheel, including how often they brake suddenly, speed, or use their phones,” and they may be used to target potential customers based on “10 different risk categories.”
Kathleen Lomax, a mother from New Jersey, contacted Life360 last month to inquire about whether the firm was selling her driving records. Lomax and her twin 18-year-old daughters pay $100 a year for Life360 to track them. “Created with the help of AI,” the automated response informed her that Life360 did share driving behavior data with Arity.
“No one who realizes what they’re doing would consent,” said Lomax, who canceled her subscription.
In an email, a Life360 representative stated that Lomax and her family’s “personally identifiable driving data” was never given to an insurance provider, that consent from a Life360 member is necessary, and that Arity must “take steps with its partners” to identify Life360 as the data source when using it to generate insurance quotes. Arity offers consumers “who choose to opt in with personalized offerings and enhanced services,” according to a statement from GasBuddy. MyRadar did not reply to messages for comments.
According to Stacy Silver, a representative for Arity, when an individual compares auto insurance quotes, the insurer must obtain permission to access the driving information gathered by these applications. However, how specific is that request? The consent to utilize smartphone data occurred when it told customers that “we may collect third party data and reports,” according to a representative for CSAA, a regional insurer for AAA members that uses Arity’s product in several states. For example, that is the typical terminology used by insurers to see a credit report, and many customers could click past it without giving it a close look.
The Fair Credit Reporting Act mandates that businesses that generate consumer reports make them available upon request. However, not every one of the millions of individuals in Arity’s database is eligible to receive their unique driving record; rather, a driver can only receive a report from the company if an insurance company requests it as part of a quote.
Arity’s driving data is not being utilized by all insurers. Speaking through representatives, GEICO and USAA stated that they only gathered information on driving habits from users who downloaded specialized smartphone apps.
According to information gathered by Arity, Allstate stated that it would “soon offer consumers the choice to get a personalized rate based on their driving history.”
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