GREENSBORO, NC-- Upgraded in car features like OnSTAR and Sync can help you back up without hitting anything, the GPS gets you where you need to go, and in some cars if you get into an accident is calls police for you.
So would you mind if this upgraded car feature tracked how you drive IF it meant you could save money? Insurance companies are offering something called the "Pay As You Go" program.
The idea is if you prove you're a good driver they'll knock anywhere from 10%-30% off your premium. You prove you're a good driver by letting the company track how fast you drive, how many miles you drive, what time you drive those miles and even how hard you hit the brake.
Insurance companies sell the pay as you go program as a win-win. You decrease your rate if you prove you are a safe driver, but DON'T increase your rate if you don't prove to be as good as a driver as they want you to be.
An senior analyst from InsuranceQuotes.com says the sell sounds good but you need to ask a lot of specific questions before signing up.
"Find out exactly what kind of behavior is tracked and how the company plans to use the information and there is any way it can be used against you negatively for instance if you got into an accident and you were speeding would that be counted against you in a future claim," says Laura Adams.
Insurancequotes.com estimates some of the people enrolled in the programs can save even as much as 50% on their rate.
According to The National Association of Insurance Commissioners 20% of insurance plans will be Pay As You Go in five years, right now they account for less than one percent.
In North Carolina, Pay As You Go insurance programs are allowed, but ONLY if the insurance company submits ALL the details of how the billing will work.
The state insurance commissioner says he doesn't want a company to give you a discount on the front end but then back load the bill with other fees.
At least one company, Progressive insurance didn't comply with that submission, so their program is not offered in the state.
According to AutoBlog.com if you don't have the upgraded in-car feature, you can get a device to put on your car. Their article says, "Vehicles that don't have GPS-based computers standard need to have GPS-based tracking devices retrofitted to their vehicles. The black box-like devices are somewhat expensive at over $100 a pop. Customers also have to pay a few bucks every month to have data transmitted to their insurance providers."