Today nearly a dozen different car insurance carriers offer a "safe driving" program for customers that elect to participate. These optional programs typically include either a plug-in telematics device that you temporarily install in your car, or a mobile phone app that you download. These programs record your driving habits from as little as 30 days to the full length of your policy and feed that driving information to the carrier about things like miles driven, average speed, acceleration and braking habits and mobile phone use while driving.
Carriers like State Farm and Progressive offer an initial discount just to sign up for the program (averaging 10% or so) and then give you the ability to save up to 40% on your policy, depending on your driving scores. These discounts are then applied to your premium at renewal and used as an incentive to keep you with that carrier.
However, while these programs may seem like an easy way to save some money on your car insurance, depending on your driving habits, your rates could significantly increase as well!
According to Progressive, 20% of drivers who enroll in their Snapshot program actually see their insurance premiums increase. And while some carriers like State Farm and Nationwide say that your insurance rates won't increase as a result of poor driving habits, most current auto insurers can and will increase your rates if your driving data doesn't meet their safe driving thresholds when participating in their safe driving programs.
So what should you do? Well, as with most questions tied to insurance, we suggest you talk to your agent about current carrier programs that make the most sense for you. If you're a very safe or infrequent driver, these programs could result in much lower rates, which are always good! But if you're easily distracted by incoming calls and texts while driving, have a tendency to hard brake in traffic, or set highway cruising speed well above posted speed limits, these programs may do more harm than good for your premiums.
Take some time to do your research before committing. If your carrier doesn't penalize you for not driving within their guidelines and only offer discounts to those who do, there's no harm in giving the program a shot. But if you're with a carrier that may increase your rate if you have a bad month on the road, you may want to think twice. Always be informed before signing up for any insurance-related savings program!