The National Highway Traffic Safety Administration (NHTSA) estimates that distracted driving costs $46 billion in economic losses and $129 billion in societal harm every year. It also cost 3,477 lives and about 391,000 injuries in 2015.
That’s a high price to pay. And if there’s a way not to pay, insurance companies will figure it out.
Distracted driving crashes have resulted in higher insurance premiums for everyone. This means you’ve borne the cost of other people’s texting. Unfair? You bet.
Allstate is looking at a different approach. Instead of jacking up everyone’s premiums, the insurance giant is charging texters more. Seems fair enough.
How does the company know you’ve been texting? And how does it know whether you’re posting that selfie while barreling down the highway? Like everything else, there’s an app for that. Here’s how it works.
Your smartphone has an accelerometer and a gyroscope that sense movement of the device. It can also tell whether you picked up the phone to glance at a text message or the phone was laying flat on the seat while the car was in motion.
The Allstate app utilizes these technologies to track whether you are using your phone while driving and your agent sets premiums accordingly.
Don’t worry, your insurance company can’t do this without your knowledge. You must first sign an agreement and download the app. Also, Texas Department of Insurance has to approve use of the technology first.
Tying premiums to dangerous driving behavior makes sense
Will other insurance companies follow Allstate’s lead? Let’s hope so.
Basing premiums on dangerous driving habits beats the current system of using credit scores. Is there really a connection between a person being careless with a credit card and a car? Not necessarily. And careless driving definitely has no connection to high medical debt. Every day, I help clients who face overwhelming medical bills incurred because somebody else ran into them.
A texting reward/ penalty program instead would tie costs to driving habits. This is not a new concept. For each speeding ticket, you not only get hit with a fine, but an insurance premium hike. If you were to get a DWI, your premiums would sore. On the other hand, your insurance company rewards you with lower premiums for keeping a clean driving record.
I rarely agree with an insurance company’s methods for cutting costs, but this one makes sense. And might actually deter texting while driving.
I also plan to use the new technology as evidence in future auto accident cases. I typically subpoena phone records to prove the driver was texting or talking on the phone at the time of the crash. However, these records don’t show the bigger picture. For example, the records would show that a text was sent to the driver’s phone, but not whether the driver looked at it. With the new technology, I would have access to data that could prove the driver’s negligent actions.