Consumer Reactions to Telematics CONTINUED
Of the positive tweets, some also expressed an interest in giving Snapshot a try. The majority of these tweets implied that the
point of considering Snapshot was to save money. An example,
tweeted by @drakino, was typical:
Anyone used or has more info about the Progressive
Snapshot ODB-II device? May use it to try and get a
There were also tweets that revealed that some consumers,
at least, had a basic understanding of usage-based insurance. For
instance, @NattyIce8 tweeted:
Going to give the Progressive Snapshot a chance...
it can’t hurt.
This implies an understanding that allowing Progressive to
monitor driving behavior wouldn’t increase rates.
Potential customers are interested in the benefits they will receive as part of usage-based insurance, and the major benefit of
interest is a discount on insurance rates. If consumers perceive
that their likelihood of receiving a discount is small or nonexistent,
they are less likely to sign up because the expected value won’t
exceed the negatives of the program. Initially, this will skew participation in usage-based insurance programs toward safer drivers.
Once a customer has decided to test the Snapshot program
but before his or her driving is monitored, the sentiment about
usage-based insurance becomes more positive— 39 percent of the
tweets have a positive tone versus 31 percent revealing a negative
attitude. The primary reason is the potential to save money.
In the Snapshot program, customers receive a device that
they must install in the onboard diagnostic system port of their
vehicle. In our study, the largest category of complaints for those
just beginning to try Snapshot related to installation problems.
For example, @jbergstf tweeted:
Searched all day for the progressive snapshot plugin in
my car... Couldn’t find the thing @ItsFlo
Many customers are new to telematics, and frustration with
the installation process can create a negative first impression
that will be difficult to overcome.
While the complaints of those who weren’t customers focused on privacy and confusion about the program, Snapshot
customers who are being monitored expressed negative reactions related to driving habits and the device’s response. The
Snapshot device beeps when a driver brakes too hard, and a
number of users disagreed with its determination of what is a
hard brake. As a result, some indicated on Twitter that they are
considering driving through yellow lights instead of stopping in
order to avoid the hard brake (and associated poor driving score).
Hard brakes have been shown by Progressive and other in-
surers to accurately predict a driver’s likelihood of having a
claim. But apparently, monitoring hard brakes can lead to un-
intended consequences. Insurance companies will need to be
prepared to adjust their monitoring when it becomes apparent
that avoiding one unsafe driving behavior is leading to other
behaviors that are equally or more unsafe. An example of this
was tweeted by user @BrandonOmernik, who said:
FIGURE 1 Tweet Tone by User Status
Source: Pinnacle Actuarial Resources
Tone by User Status
Positive Neutral Negative