Between the Internet of Things and the wide world of Big Data, the future looks a lot more personalized and automated. Sure, there are privacy concerns, but there's also the potential to save some money. The insurance industry certainly thinks so, which is why behavior tracking might play a bigger role in determining your monthly rates going forward.
Video of the Day
Marketing researchers at the University of British Columbia and Purdue University have just released a study asking whether using sensors on cars can actually affect car insurance prices in a beneficial way. This process is called telematics-based UBI (usage-based insurance) auto insurance, and it uses devices to measure miles driven, time of the day, where the vehicle is driven, rapid acceleration, hard braking, and hard cornering. Overall, the results are good: Drivers who have opted into the program tend to drive more carefully over the same number of miles.
In fact, younger drivers, especially women, "tend to improve their UBI scores more than older drivers and males," as coauthor Miremad Soleymanian said in a press release. While the study authors do acknowledge the driver's loss of privacy, they note that insurance companies do give out higher discounts on auto insurance to UBI-participating drivers. This is great news in one other respect: With cars getting smarter (and more expensive to fix) all the time, insurance costs may creep upward. If UBI can balance out those bills and encourage safer driving habits overall, in the end, it might not be such a bad buy-in.