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The gas pump isn’t the only thing hitting your wallet. Auto insurance rates continue to rise and many drivers are looking for ways to save money. These days, most insurance companies offer car insurance tracking devices, but what are they and how do they work?
Auto insurance tracking devices are also known as “driver monitors,” and you’ve probably seen options for usage-based insurance discounts and premiums that use a tracking device.
These devices connect to your car or are app-based and collect data about your driving habits, which could offer discounts for drivers who are cautious or those who don’t drive often. These are the basics and what you need to know.
What is a car insurance tracker?
A car insurance tracker is a plug-in device or smartphone app that tracks your vehicle, driving habits, and more, and can offer savings of up to 30% on your insurance rates. One of the first that comes to mind is Progressive Snapshot, which can provide bonuses based on usage.
All of these devices use GPS and other sensors, many of which are already inside your phone. The collected data is then used by insurance companies to see if you are a safe driver.
There are two main types of car insurance trackers available. The first is essentially a dongle that the user plugs into the OBD-II port under the steering wheel. It plugs into the same place the DMV uses to pollute a vehicle. This is the “on-board diagnostics” port, which can access information from the vehicle’s computer.
The second is an app that you can download to your phone. Mobile apps use your phone’s GPS, data, accelerometer, and other sensors to track movement and driving. The type of tracker depends on your insurance provider or plan and may vary by user and region.
Lately, we’re seeing most insurers ditch the dongle in favor of mobile apps, then you connect the app to a Bluetooth-enabled device that provides your insurance and place it inside your car. Some of these include Progressive Snapshot, State Farm Drive Safe & Save, Geico DriveEasy, and others.
How do these insurance trackers really work?
So how do these devices work and what do they track? Again, this varies by brand, but the device or app will track your driving habits, location, vehicle information, and potentially more. Insurers provide the dongle or app as part of a usage-based insurance (UBI) program.
It will then collect metrics, including speed, hard braking, mileage, and even time of day, to formulate your monthly insurance premium. Here is a typical list of what you can expect the device or app to track:
- driving speed
- Driver acceleration style
- Braking habits (how hard you brake, etc.)
- Steering (fast curves, tight turns, etc.)
- Driving time, length, direction and distance (day or night driving)
- Mileage
- driving place
- Phone usage (in app-based trackers)
- and more
As you can see, these devices or smartphone applications collect a lot of information. And while insurance companies understand that braking hard is a part of life sometimes, the system can take into account critical information about your location, traffic lights and speed limits.
Insurance companies know that certain situations occur on busy roads, but if you’re constantly driving erratically, they’ll recognize it. On the other hand, if you are a safe driver, the system will collect that data and you will get a lower insurance premium.
Car Insurance Tracker Pros and Cons
As you can probably imagine, there are several different pros and cons to using a car insurance tracking program. The most obvious benefit is that you’ll get a lower insurance premium and save money, especially if you’re a safe driver or don’t drive very often.
Also, if you accelerate frequently, run stop signs, and don’t exhibit good driving habits, you may not want one in your car. It could potentially increase your rates. Insurance companies tend to frame it as “you’ll get a discount no matter what,” but that’s not always the case.
All of these insurance tracking devices track your location thanks to GPS. Knowing the location of your vehicle has several advantages in addition to the price of the rate. For example, location data can help first responders in an accident, recover a stolen or towed vehicle, and much more.
Another great benefit for parents is the ability to track or monitor child and teen drivers. Many of these platforms offer an app for parents to see when and where kids are going, speed, and other risky behavior. It’s a great way to keep track of children or older family members.
However, with all the data insurers collect, privacy is a concern. According to the Insurance Information InstituteMany states have legislation to ensure insurance companies are open, honest, and transparent about the information they collect.
That said, remember that your insurance company will have a lot of information about you, where you’re going, driving speed, and much more. And, as we said earlier, some of the app-based programs can and will track phone usage, which could lower rates if you’re actively using a mobile device and texting while driving.
Should I use a car insurance tracking device?
So, is an insurance tracking device or driver monitor worth considering? Honestly, we can’t answer that question for you. Obviously, there are several huge benefits. Whether it’s tracking down your kids, finding a stolen vehicle, or saving money monthly.
On the other hand, privacy is a growing concern (in general) these days. Where does this information go? Does the company sell data and can you choose not to share specific details? Those are all questions you’ll want to ask your provider.
At the end of the day, it’s up to you. If you’re a safe driver with good driving habits, you could benefit from one. Those who don’t exceed the speed limit, rarely drive at night, or even drive less than 11,000 miles a year can see discounts.
Some car insurance providers even have an app you can download and run for a few days as a trial, then see if you can qualify for cost-saving plans. Either way, remember that if you have a car insurance tracker, every move you make in a vehicle will be tracked, monitored, and aggregated into one data point.
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