But there is no way I would opt in for even MORE surveillance. I won't even let my wife install the google or amazon home automation devices. I hate what the internet has become.

I get that some risks are fairly constant (e.g. theft), but premiums could be better correlated to actual risk.

Similarly, the cost savings from increasing my deductible just isn’t there. Going from $1000 to $2000 should be more savings than a handful of dollars per year, since that will save insureco on just about every single claim.

There’s no way they’re charging me $100+/month if my risk of a claim is 2-3% per year.

But insurers' models are complicated. One factor to consider here is that the population with $1000 deductibles isn't the same as the population with $2000 deductibles. For example, some of the latter group have a higher deductible because they're financially stable enough to afford a $2000 emergency expense, but others have it because they're financially unstable enough to need the cheapest coverage they can get. There's a strong negative correlation between an individual's financial stability and their risk to an insurer, so in net, it wouldn't surprise me if the latter group is riskier on average.

Also, even if raising your deductible reduces your expected claim costs by more than a handful of dollars per year, insurers in most of the US aren't required to pass that savings on to you - they can price coverage based on your willingness to pay (see [0] and [1]). On the bright side, auto insurance is arguably about the closest thing there is to a perfectly competitive market in the US - your insurer has lots of competitors, and if they're overcharging you relative to your risk, it's easy to find a better deal elsewhere.

[0] https://www.naic.org/cipr_topics/topic_price_optimization.ht...

[1] https://www.npr.org/2015/05/08/403598235/being-a-loyal-auto-...

Our government policy (Ontario Canada) is to ask insurers how to reduce premiums, then the government lets them reduce/cap benefits and premiums go up anyway.

It’s one of the many markets we would open to more competition. A lot of US insurers would salivate at our rates.

Which is more then enough because most of the insurance pricing is determined by sales and administration costs and not by price of risk itself.

To give a simplified example, say a good driver costs an average of $100 per year and a bad driver costs $10,000. If without trackers, you can get 100 customers where 10% end up ultimately being bad, the cost over the year ends up being $100 * 90 + $10,000 * 10 = $109,000 or $1,090 per customer. If trackers let you get down to just 8% bad drivers, your expected costs are $100 * 92 + $10,000 * 8 = $89,200 or $892 each.

That lowered cost means more competitive rates, which in turn drives positive selection (i.e., good drivers will be more likely to sign up for your service in the first place). Those bad drivers you passed on also aren't just going away - they're going to competitors and driving up their costs.

Let's use your data; they currently pay ~$1,090 per customer. So for the sake of argument, let's say that they charge $1,100 and keep that $10 in expectation. Now they install GPS trackers, and they can identify two classes of behavior; class A drivers (50% of drivers), who have a 4% accident rate, and class B drivers (50% of drivers), who have a 16% accident rate. The combined rate is still 10%.

Class A drivers cost 48 * 1e2 + 2 * 1e4 = $24,800 = $496/driver

Class B drivers cost 42 * 1e2 + 8 * 1e4 = $84,200 = $1,684/driver.

So this is great -- good drivers pay less, risk profiles are narrowed, etc. Maybe the bad drivers can be given feedback that will tell them what things they can do to minimize their accident rate based on the GPS data, and get some feedback on that -- "drive slower", "stop at red lights", "stop running into parked cars" -- things that both improve the metrics for the GPS and result in safer drivers.

But maybe the metric that the adjusters found are "frequently drives in historically Irish neighborhoods", or "drives to fast food restaurants more often". Now things get diciers. And what if the things that the GPS is measuring are not proxies for how bad a driver they are, but how willing they are to settle with cash without involving insurance. Or the correlation is a false one -- it could be that most of the Class B drivers are excellent drivers, as good as Class A, but they have to pay Class B rates because they got lumped in with a secondary association not related to quality of driving.

This is a problem with any attempt to bring more metrics to bear in computing insurance rates, but is especially exacerbated by the invasive nature of GPS-based metrics, which can be used as proxies for all sorts of socioeconomic signals that allow open discrimination.

The issue here and my concerns with GPS trackers in general is if they are seen as providing valuable insight to how a person drives. This simply is not the case because so much of driving is context dependent. A few weeks ago, my brakes gave out briefly and I swerved sharply into the shoulder of the on-ramp I was on and finally came to a stop in the median between the on-ramp and the road I was trying to merge on to. Purely from GPS data that looks like erratic and dangerous driving when in reality I saved the insurance company money by managing to avoid hitting anything with my car.

Worse than this, who say's they'll use the data honestly or competently?

Maybe they will draw false inferences from your innocuous driving data and still label you a 'bad' driver.

Then, if you try and argue with them, they'll make an appeal to the data, and attempt to shut down all debate.

2. It's called bumper to bumper traffic for a reason. Following distance is <1 cars length. Anymore than that and some bozo is going to slide into your lane.

3. You know nothing of me nor my driving habits. I simply pointed out that brakes can fail or appear to fail for reasons other than mechanical failure.

Yes, but that's not because of your driving habits, is it?

> 2. It's called bumper to bumper traffic for a reason. Following distance is <1 cars length. Anymore than that and some bozo is going to slide into your lane.

Heaven forbid your ego take a little blow to make everybody safer.

> 3. You know nothing of me nor my driving habits. I simply pointed out that brakes can fail or appear to fail for reasons other than mechanical failure.

I know exactly what you've told me: You drive in a manner likely to cause your brakes to overheat and fade, a problem that many, many other people driving in the same conditions as you are able to avoid. Therefore, you should pay more than them for insurance, all else being equal.

Also: when you have an automatic and can’t depend on your engine for some braking power to take a load off the brakes.

Also, I haven't worked in property/casualty insurance, but my understanding of these trackers is that they don't include GPS capabilities, almost certainly for those sorts of reasons you mention. The risk of bad headlines incentivizes carriers to do what they can to ensure that the false-positive Class B drivers are not correlated with anything potentially sensitive.

A friend has one of these in her car and it literally has an LED labelled GPS. Which makes no sense because one of the arguments I heard they need GPS to get mileage and speed, which you can already get from OBD.

If the data collection is verbose enough, dead reckoning from speed/acceleration information can be used to unmask some non-driving information. It can't be generally unmasked completely, but even small correlations, like "they start slow in the morning but go faster after xx seconds" -> "they live near a freeway" -> <regional information> -> "they are slightly more likely to be rich" -> "they under-report accidents" can be inferred, leading down the same path. This is the sort of thing that I was indicating above -- a lot of "good" drivers can be lumped in with the "bad" ones to make Class B, if you can establish an attributes that appears to be causal but whose accuracy is low.

I would rather we not normalize technology that really has no reason to exist but to allow insurance companies to optimize the last meaningless % of their margins at the cost of a slow erosion of an expectation of privacy. (companies who already have a history of doing questionable things to deny claims and avoid liability, enoughso that I have personal stories on this matter)

As the insurance company couldn’t determine your driving ability themselves, and therefore offers the same price regardless of ability, the black box allows customers to pre filter themselves before applying, hopefully reducing the average accident rate.

There’s decreasing value to pooling when the risks are perfectly quantified at the customer level.

2. It's a wealth of data that can be used to generate other things about you. It's also data that's traditionally very hard for other parties to get a hold of - your car's make, model and your address is typically not secret information, but for the most part nobody but you knows everything about how you spend your time.

And once your insurance company has this information, you lose control over it. They can share it with other companies, with law enforcement, with parties that may not be relied on to keep the information secure.

Wrong inferences can be made about you, can be shared out.

First and foremost, it's only ever going to be used against me if it is used. I would basically have to bet I was never in an accident, which, given I've been hit three times while legally stopped in the last 5 years, I'm not willing to do. I suspect for the vast majority of drivers, the monitor is a net cost, not a net savings.

But also, there is not a one-to-one relationship between liability and safety. Insurance companies care about liability first, and if they care about safety, they care about it second. I'd like to see some studies on how these monitors influence driver behavior before even considering getting one installed.

For another, the monitors lack context. It is safer to travel at 75mph in a 65mph zone if traffic is going 75mph and the road (and your vehicle) otherwise supports that speed. (Put lazily without citation: At that speed there is almost no difference to increased speed in terms of serious injury or fatality, but at that speed variance, the likelihood of a crash occuring is higher. Net result: more serious injuries and fatalities driving at the slower speed.) But the monitor will only see you going 10mph over the speed limit.

And then, as a sibling poster mentions, there are the privacy issues. If it monitors your location, it is monitoring far, far more than your driving habits.

So do you have a citation?

From memory, the TL;DR of the study was "speed differentials cause accidents, not speeding" along with "speed differentials cause more likely to be fatal accidents". A car going 75 MPH rear ending a car going 70 MPH is going to do less damage and potentially be less fatal than a car going 75 MPH rear ending a car going 55 MPH.

I'll see if I can find the actual study.

[0] https://sites.psu.edu/siowfa15/2015/09/18/is-driving-faster-...

I think the privacy line is already drawn too far, but aside from that, I think if monitoring 'driving behaviour' involves GPS tracking, it crosses the line because you can use it to infer the people and groups you associate with.

A GPS will collect a lot of data that can be used for blackmail by rogue employees.

These are just some cheap consumer model ones the boss picked up for about $100 each.

The more advanced and expensive ones he showed me, could give you even more detailed real time.information.

“You’re 3 seconds away from a collision with 99.9% likelihood. Your insurance is now terminated”.

   Effectively mandatory meaning that insurance without a tracker will be like 10x the price

An insurance company would have to drastically shrink, and so would its net profits, to do as you describe. So it quite obviously won't happen. Premiums will remain where they are. The price floor is effectively established.

(I do look forward to the next permutation, "well what if somebody lowers prices," so we can have a good round of explaining what a cartel is.)

I get concerns about privacy & whether the market forces will actually work. But, pricing risk is also the fundamental business of insurance, so it seems very intuitive & logical for them to add additional parameters to quantify risk in their models. The better they can quantify the risk, the more competitive their rates can be, and the more successful they are as a business.

But where is their price floor right now compared to their operating margins?

If the business is mostly actuarial risk, then dramatically lowering that risk by more accurately characterizing good and bad drivers would see premiums plummet.

If the business is mostly SG&A, then better assessing individual risk would be misapplied optimization and wouldn't affect premiums much at all.

(I do look forward to the next permutation, "well what if somebody lowers prices," so we can have a good round of explaining what a cartel is.)

Do you have good reason to think that car insurers have formed a cartel?

Corporations will never, ever be in the business of making less money.

An alternative would be to only require tracking for drivers who have proven themselves to be unsafe (found to be repeatedly at fault in accidents). Car insurance is not just protection against accidents due to traffic and weather, it's also protection against negligent behavior of drivers themselves.

In the longer term, though, we need to switch to other forms of transportation that don't require individuals to self insure. Perhaps that will be self driving car and bus services, that don't have the huge risks associated with people driving, or maybe they will involve expanded rail service.

Bad drivers are already a part of the risk calculation.

I think the desire to track them individually is a manifestation of our North American propensity to look for punitive solutions.

And I would almost guarantee that someone made money off of establishing a contract to sell such tracking devices to the state, to then sell/force them on bad drivers.

Profit > Punishment

Private insurance companies buy these, not the state

> to then sell/force them on bad drivers.

They don't need to be forced. Those drivers could be offered the option of installing them with a smaller increase in premium, and not installing them with a much higher increase in premium. Eventually, if their driving habits don't change for the better, they will be priced out of auto insurance, which is what happens today if you continually are at fault in car accidents.

At a certain point, that's the same as being forced.

At a certain point, the risk you impose on the insurance pool by not driving safely is greater than your ability to pay for that risk, so you have forced (priced) yourself out of insurance coverage.

You can always go with another insurance company who will offer you terms that don't involve the tracking device, but they aren't going to extend that coverage to you for a lower price.

But not everyone can be a safe driver, which is one reason we need alternative transportation options for them.

That's a weasel statement. "bad" "part" "calculation" are all soft terms. You can always tighten the metrics, which a GPS would allow for, given time and rigor.

But I do believe that we have a bias towards solutions that punish a particular person.[1]

It's an insurance company, if many people drive badly then you can be sure they've factored it in because they don't lose money over a solved problem like that.

I still don't think we should target bad drivers for extra surveillance, because I value the privacy of the bad drivers too much.

Also valuing the privacy of the bad drivers, is just valuing my own privacy down the road. [2]

[1] https://en.wikipedia.org/wiki/Just-world_hypothesis

[2] At first they came for the bad drivers, but I wasn't a bad driver ...

Yeah, that's why trucks and buses beep all over the world.

Thanks for the noise, insurance industry!

How are you getting 'genocide' from the above comment?

> [2] At first they came for the bad drivers, but I wasn't a bad driver ...

This is an allusion to "First they came... ", a poem written by a German Lutheran minister recalling the cowardice of contemporary German intellectuals who would not oppose the Holocaust:

https://en.wikipedia.org/wiki/First_they_came_...

You should be careful using allusions when you don't understand their origins.

Even if I tried, there is literally no way I could possibly self censor myself enough to avoid offending everyone on the internet.

These types, of threads based on offense are a waste of time:

1) If the person claims to be offended, you can't refute that because the offense is an internal state that they claim they are experiencing.

2) If the claim is that someone else maybe offended, then you also can't argue against that because now you are debating on an inference for which there is no firm evidence.

It's like those endgames in chess where you wish you didn't have to move.

Even by responding to this, I lose, because I will be likely down-voted for not being sensitive enough, even when no offense was ever intended.

However I can flip it on you. Go and find proof that I intended to offend with my comment.

Try not to be offended by constructive feedback, and now that you know, perhaps think twice before you use that allusion in the future. I've also made similar well-intended mistakes, and I've benefited from others helping me learn and grow from them.

> You should be careful

You're doing some serious backflips there. As if he isn't being careful enough for your taste. That's just useless drivel.

Read the thread again: Once it was clear that they were legitimately unaware of the origin of the allusion they made, the suggestion I made was to be careful in general using such allusions.

# of claims filed

% of claims initially denied

% of claims denied eventually settled

Breakdown of claims by jurisdiction/claims adjuster

Total $ collected in premiums and total $ paid out in claims

Most importantly the insurer should have to make the insured data profile available to the insured

What’s good for the goose is good for the gander

Or, once a critical mass is reached the insurance industry will lobby for it to be mandatory in all cars, selling it as a safety feature.

I look at Tesla's spy system as the sort of dystopian future we can expect.

Use your tracking token (safeway club card = phone number) or your groceries will cost significantly more.