I guess it makes sense to use this if you've begun using a password manager without changing your old passwords. But if possible you should really be doing that instead.

Also, I still don't understand why Troy doesn't use a cryptographically secure hash function instead of SHA1. Say I send the (truncated) hash of one of my passwords to his service and it returns no match in his database. I then consider it secure because it's supposedly not leaked. But shouldn't I really do consider it leaked because I've revealed an insecure hash of it to a third party? What's there to lose with using a secure hash function over SHA1? Surely the one-time cost of hashing the database of passwords is negligible?