What is a car insurance tracking device?
Insurance tracking devices are small devices that gather information captured by your car’s computer and provide it to the insurance company. The devices won’t change the way your car operates (they won’t limit your top speed or when and how you drive) and won’t cause any harm to it.
Why do insurance tracking devices exist?
Tracking devices allow insurance companies to accurately identify their safest drivers and then reward them with discounts. The discounts are also an excellent way for insurers to attract new customers.
The devices may also help control the price of auto insurance for people who don’t have them installed. How? By helping insurance companies combat phony insurance claims. According to the FBI, each year, insurance companies pay over $40 billion for phony claims. And part of the cost for those phony claims gets passed along to honest customers. Insurance tracking devices help stop fraud and help keep insurance prices from rising.
So, how might insurance trackers identify fake claims? Let’s look at an example. A driver might claim that he was driving responsibly when an animal darted in his path, causing him to brake suddenly, slide off the road, and wreck his car. However, the data collected by the insurance tracker might tell a different story. The tracker may help the company determine that he crashed due to reckless driving or even in a deliberate attempt to collect the insurance money.
Insurance trackers plug into your car using a port typically found below your steering wheel. This is the same connection that a mechanic uses to read your car’s computer data and discover any problems with your vehicle. The insurance company’s device also reads your computer’s data. But instead of looking for issues with the car’s operation, it scans for information connected to what the insurer needs to know about your driving habits.
Do insurance companies track your speed?
The answer depends on the insurance company and its policies regarding its tracking devices. However, the capability is there. The tracking device can, in theory, read any information that your car’s computer processes — and that includes speed. If you’re not sure, ask the company. They may explain that tracking your speed gives them a better understanding of your driving habits. After all, drivers who obey speed limits tend to be safer drivers.
What else do insurance companies track?
Speed isn’t the only thing insurance trackers can monitor. Here are some other pieces of data they can track:
- Your car’s location
- The date and time of your trip
- How quickly you accelerate
- How aggressively you apply your brakes
- How fast you turn corners
- If you make and receive phone calls (using the car’s technology) while driving
- Your mileage
- How frequently you drive
Do tracking devices reduce your insurance costs?
An insurance company may give you an immediate discount on your insurance simply for agreeing to use their tracking device. Generally, the company will provide a way for you to keep track of your potential savings. For example, you might be able to check the company’s app to instantly see if your driving habits are saving you money. The information may constantly update, giving you an up-to-the-minute picture of your insurance costs and savings.
Should you let your insurance company monitor your driving?
Because most people are unfamiliar with insurance trackers, the devices can often seem strange and even frightening. Some people immediately get nervous at the thought of their driving habits being monitored.
However, other drivers have embraced insurance trackers as a fair and legitimate means to save on their insurance. When insurers see that your driving habits present a low accident risk, they’re more likely to give you better rates. And seeing your insurance rate go down could inspire you to become an even safer driver.
Are there risks of using car insurance tracking devices?
In this age of hackers, some people fear that information about their driving habits will be stolen and used against them. But insurance companies routinely encrypt the data they collect from your car so that it’s useless to anyone who might intercept it. The companies also typically agree not to share your data with anyone except law enforcement agencies when legally required to do so. But if you’re concerned about security, ask the insurance company.
It’s important that you understand what a particular company’s insurance tracker will monitor before you agree to its installation. You also want to be clear about how this information could affect you. For example, if you primarily use your vehicle to drive a short distance to work, you might expect an insurance discount. But what if you work at night? Will you receive a penalty for driving the car during late-night hours? What if you have to drive through a high-crime area during your commute? Will this also affect your insurance rate?
Do your research and ask lots of questions. Insurance trackers have the potential to save drivers money, but only you can determine if they’re right for you.
FAQs
How do car insurance trackers work? Insurance trackers plug into your car using a port typically found below your steering wheel. This is the same connection that a mechanic uses to read your car's computer data and discover any problems with your vehicle. The insurance company's device also reads your computer's data.
How do car tracking devices work? ›
It uses Global Positioning Systems (GPS satellites) to know the vehicle or equipment's location on Earth at all times. The information gathered from the vehicle is then stored on the device inside, sometimes on internal storage like a sim card while others send their data to a cloud-based system.
How do car insurance apps know who is driving? ›
Car insurance tracking apps use various sensors and data sources within your smartphone to collect information about your driving behavior. The Global Positioning System in your smartphone plays a crucial role in tracking your location and movement.
What are the risks of using car insurance tracking apps? ›
One of the most significant risks of using car insurance tracking devices is the invasion of privacy. These devices track where and when you drive, creating a detailed log of a driver's movements. This information could be subpoenaed in a court case or used in ways the driver did not initially consent to.
How do insurance companies track your mileage? ›
Car insurance companies get your odometer readings in a variety of ways. They might ask you directly or obtain it via a tracking device you've consented to install. Insurance tracking devices come as dongles that you can plug into your car or an app for your smartphone.
How do insurance companies track your driving? ›
Insurance trackers plug into your car using a port typically found below your steering wheel. This is the same connection that a mechanic uses to read your car's computer data and discover any problems with your vehicle. The insurance company's device also reads your computer's data.
How do insurance speed trackers work? ›
These devices monitor your speed, acceleration, braking, and other details each time you drive and report the information to the insurance company. Car insurance companies use the data they gather from the tracking device to adjust your premium or offer a discount.
Can insurance companies put a tracker on your car? ›
You may be wondering whether your car insurance company can track your car. UBI (or good driver) programs are voluntary. In other words, your insurance company can only track your vehicle if you opt into a program. If you've opted into a program and no longer want to participate, you can also opt out.
How does Root know if I'm driving or a passenger? ›
How does Root car insurance work? The Root app uses technology in smartphones to measure driving behavior—such as braking, speed of turns, driving times, and route consistency—and determines who is a safe driver and who isn't.
What happens when you unplug a car tracker? ›
The plug-and-play devices work when plugged into the car and not when it disconnects. It is easy to disable it. Also, the devices have an internal antenna and battery to keep sending the signals. When the same is unplugged, it sends an alert to the owner.
Allstate Drivewise also tracks phone activity. This feature lets drivers know when and how often they use their phones behind the wheel. It's designed to provide awareness and encourage safer driving behavior, and it doesn't affect the Drivewise discount.
Are car tracking devices worth it? ›
Security: Arguably, the top benefit of adding a GPS tracker to your car is the added layer of security. If thieves steal the vehicle, it will be much easier to locate. Lower insurance premiums: Some insurance companies offer policy discounts for vehicles with tracking devices.
What happens if you underreport mileage on insurance? ›
Many people underreport their mileage when they sign up for their policies, and insurance companies know it. Underreported mileage is technically fraud, and it costs insurance companies money. Usually, insurers look the other way (though they can reject a claim based on underreported mileage if they find out about it).
How does the state farm tracking device work? ›
Here's how it works
The Drive Safe & Save app 3 pairs with the Bluetooth beacon we'll send you after enrollment. Keep your Bluetooth and location services on to automatically record trips when your phone connects to the beacon in your car.
How does Snapshot know if I'm driving or a passenger? ›
How does the Snapshot app with Road Test know if I am driving? The app can tell when you're driving based on your speed and the distance you're traveling. It can also tell when you're the driver rather than a passenger. It's entirely automatic, so you can hop in your car without a second thought.
Do car trackers give exact location? ›
It offers exact positional data, which is necessary for precise vehicle tracking. On the other hand, the receiver analyzes the signals the antenna has picked up from the satellite.
Do car trackers work when the car is off? ›
This is dependent on the type of tracker you use. Most, if not all trackers operate by using the car's battery/electrical system to power it. So for some models of car trackers, they will not track the location of the vehicle if it is off.
How far does a GPS tracker work? ›
Typically, the information provided by GPS trackers is accurate to within three meters. However, any obstruction on the line of sight between the device and the sky can affect the accuracy of the location data it transmits, such as tall buildings, bridges, tunnels, or dense forests.
Do GPS trackers require a subscription? ›
In most cases, a GPS tracker will require a monthly subscription cost.
