Got that new progressive snapshot, and it records
when you break [sic] too hard.. just more of a
reason to run red lights.
While providing feedback on the monitored driving will
be an essential part of any usage-based insurance program,
we didn’t find comments from anyone who liked that the
device beeped. As they design usage-based insurance programs, insurance companies need to consider carefully their
plans for providing immediate driver feedback. While it’s a
dynamic way to help consumers improve their driving behavior, it might not be worth the aggravation it apparently
causes. Perhaps a better way for insurance companies to
encourage driving modifications and avoid antagonizing
customers is by enhancing existing web portals that allow
drivers to obtain an ongoing evaluation of their driving.
To lock in a permanent discount in insurance rates, the
Snapshot program requires only that drivers be monitored for
six months. Such a defined evaluation period might encourage drivers to modify their driving habits just for the limited
time frame, creating the potential for unjustified discounts.
The issue of context in driving behavior is more challenging to overcome but will need to be addressed if customers
are going to embrace usage-based insurance plans in large
numbers. Currently, many companies count episodes of
particular driving behaviors, such as the number of times
the vehicle’s speed goes above a certain limit or the number
of hard brakes, to evaluate a driver. This approach isolates
potentially unsafe actions and evaluates them individually.
While a good first step, it doesn’t completely explain the
driving situation. Driving 65 miles per hour on an uncongested highway is very different from driving 65 miles per
hour on a congested road where the speed limit is 40 miles
per hour. To gain a fuller picture, companies will need either to track environmental information or begin to look
at the interaction and sequences of driving behaviors. This
will allow insurers to better understand the circumstances
surrounding a potentially unsafe action and evaluate the
driving behavior accordingly.
A Snapshot of Snapshot
■ ■ Progressive customers can sign up for Snapshot
while they are obtaining a quote for insurance.
Those who aren’t customers of Progressive can
sign up for 30 days without switching insurance
coverage to determine the discount they could
receive as part of the Snapshot program.
■ ■ Once the customer is registered, Progressive sends
the telematics device to the customer, who installs
the device in his or her vehicle’s onboard diagnostic
■ ■ After 30 days, customers begin to earn a
provisional discount based on their driving
behavior. They must keep the device installed for
an additional five months, however, to lock in the
renewal discount. Discounts can be as high as 30
■ ■ Progressive tracks speed, time of day, and
whether the device is connected or disconnected
from the vehicle. Miles driven and acceleration
and deceleration rates, among other things, are
calculated from the speed and the time of day.
■ ■ These data elements are combined to calculate
a driver score, which is used to establish the