You’ve probably heard that insurance companies are offering trackers to either lower your policy costs, or offer a discount for good behavior. This might indeed present a series of benefits, but there are some cons to consider before accepting an auto insurance tracking device in your car.
Pros of Auto Insurance Tracking Device
If you pay by mileage
You could save money on premiums because these telematic devices are connected to your car to track mileage. However, keep in mind that if you drive a lot to and fro, the savings might not be as much.
It can help you drive safer
These driving trackers store data about your driving habits and they send that information to your insurance company. That could end up adding up to your premium, so a tracker can help avoid the dangerous driving habits we all know.
Lojack at no added price
This is a tracking device that allows you to locate your car in the case of a theft or accident; it doubles as a way to monitor your teenage driver, prompting them to be safer drivers as well.
Cons to Consider
How much will the car insurance know?
No one likes to feel observed like in Orwell’s book 1984, and the insurance companies will definitely have data from your driving habits. Your location will also be tracked.
Incorrect risk assessment
The information stored by the device doesn’t take into consideration road conditions or weather, such as dirt roads, hills, curves, or rain, and therefore the insurance company could be getting incorrect data about your driving habits.
Pay-as-you-go can be expensive
As you pay per mileage, like we mentioned before, the true benefit depends on how much you drive daily. A fixed premium covers you no matter how much you drive, but pay-as-you-go can mean overage charges that aren’t fun.
Added costs of installation and fees
One thing to ask your insurance company before you sign up for this driving tracker is: Is there an added fee or an installation cost? If there is, you need to consider it in the overall cost of your insurance premium/pay-per-mileage schedule.
Your insurance company might want you to take advantage of a discount now, but what about in the future? Is the deal and discount good for a certain amount of time? What happens after 6, 12 or 18 months? Will penalties apply then?
Auto Insurance Tracking Device : Yes or No?
Weigh the pros and cons before getting an auto insurance tracking device. It could mean a good amount of savings plus an added security feature for you and your family; or it could mean more premium but with added benefits. Just keep in mind that some insurance companies may disclose the data they track, so make sure you not only read the fine print, but also specifically request a list of items that will be stored.
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