Is it a bad idea to have a car insurance driver monitor?

If you’ve been looking for ways to save on car insurance, you may have come across usage-based insurance programs. Drivers who opt into these programs agree to have their driving habits monitored with a telematics system or device. In exchange, they can save as much as 15% on their insurance rates.

While you can save on car insurance if you allow car insurance companies to monitor your driving habits, driver monitors may not be a good fit for everyone.

With this guide, we’ll help you decide if car insurance driver monitors are right for you based on how you drive, what information these telematics devices collect, and which companies offer usage-based insurance.

Before you decide if a usage-based insurance program is right for you, enter your ZIP code in our free online quote tool to compare rates from car insurance companies that offer driver monitors.

How does a driver monitor device affect car insurance rates?

Most driver monitor devices offered by car insurance companies will lower your rates, regardless of how safe of a driver you are.

Programs like Allstate Drivewise, Nationwide SmartRide, or State Farm’s Drive Safe & Save are basically guaranteed to save you at least a small amount (around 5% to 10%) just for participating, and the savings only increase from there (up to as much as 30% or 40% with some programs).

Progressive and Geico, on the other hand, have usage-based insurance programs that may lower some drivers’ rates but may also raise rates depending on how a person drives.

Who should use a driver monitor device?

Not all usage-based car insurance programs or the driver monitor devices that come with them are created equal. One insurance company’s offering may be great for one driver but awful for another.

The Insurance Information Institute points out that usage-based insurance can vary in complexity. While some programs simply look at how many miles you drive and adjust your rates accordingly, others monitor behaviors like braking habits and distracted driving to create a complex driver profile.

Likewise, some programs adjust savings based on factors that are sometimes outside of a driver’s control. If you commute to or from work at night or often find yourself in bumper-to-bumper traffic, it can be difficult to get the most out of usage-based programs that penalize you for driving in the dark or braking too suddenly.

What are the risks of driving with a monitor device?

If you opt into a driver monitor program with most car insurance companies, what you’re risking is your otherwise private driving habits and data. The exact information your insurer can view may change depending on whether you use a driver monitor device, app, or both.

According to the Boston Globe, app-based programs will report you if you pick up your smartphone while driving, so make sure all phone use is hands-free to avoid fines.

Usage-based car insurance from Geico or Progressive also carries a financial risk, as these companies will sometimes apply surcharges if your driving habits drop below a certain rating from the monitor.

What car insurance companies offer driver monitor devices?

Many major car insurers can provide you with a driver monitoring device. Although the risks and benefits of their programs vary, the companies listed below all offer at least one usage-based insurance plan:

• Nationwide
• State Farm
• Allstate
• Progressive
• Geico
• Liberty Mutual
• AAA
• Metromile

How to Decide if a Car Insurance Driver Monitor Is Right for You

• Are you comfortable letting car insurance companies have access to your telematics data, possibly including the sharing of this information with advertisers?
• Are you a safe driver looking to lower your rates with your good driving habits?
• Do you often drive at night or on roads congested with traffic? If so, you may want to look for a program that focuses less on braking habits/time of day
• Do you drive fewer miles than the average driver? Many usage-based insurance programs take miles driven into account when determining your rate

Looking for the best car insurance companies that offer driver monitors? Try our free online quote tool to find affordable insurance that’s right for you.