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Progressive Tests Driver Monitoring System in Minnesota

Some residents in Minnesota are being asked to let Progressive Insurance electronically collect their driving information. In the pilot program, Progressive seeks 5,000 customers in...
August 17, 2004

Some residents in Minnesota are being asked to let Progressive Insurance electronically collect their driving information. In the pilot program, Progressive seeks 5,000 customers in Minnesota to test a high-tech chip that will monitor how fast, how far and when they drive. A person who drives low mileage at low speed during off hours has the most chance at earning rate discounts. In 2001, Progressive tested a similar system but decided not to pursue it because of its high cost and privacy concerns. Others are looking into the concept. GMAC Insurance and the OnStar tracking system are joining forces to offer mileage discounts. Overseas, British insurer Norwich Union said it will begin testing a use-based payment system later this month based on global positioning satellite (GPS) technology.

A Minnesota official said it's not illegal to ask for such information, but its use will need to be scrutinized because of privacy concerns. Bruce Gordon, a spokesman for the Minnesota Department of Commerce, which regulates insurance added, "The issue going forward is how, if at all, the data might be used for other customers. We'll have to take a look at it." Progressive did a smaller test earlier this year. One participant, Adam Gordon, told the St. Paul Pioneer Press "This at least gives me the illusion that something that I do might have an impact on my rates."

Checking Your Driving (St. Paul Pioneer-Press 8/10/04)

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