A new insurance scheme in the state of Texas that considers the motorist’s driving habits is creating fuss over the technology it employs. Following other states like California, Nevada, and Alabama, Texas has also recently revealed the existence of a behavior-based insurance program offered by several companies.
The new insurance program rates premiums based on the driving behavior of policyholders. While not mandatory, the new scheme has caught on with drivers who feel that they can benefit from lower premiums by the way they drive. Many Texans are also warming up to the idea of an insurance program that considers their driving habits.
Industry experts say that the new scheme will be advantageous to drivers who avoid aggressive driving and who follow proper driving techniques while behind the wheel. The program will also benefit motorists who travel less than most American drivers.
The behavior-based insurance program gives policyholders the chance to directly affect their premiums by the way they behave while on the road. Driving less can also mean lower insurance costs.
When a motorist applies for the program, a small device is installed in the vehicle to monitor and record the driver’s habits while behind the wheel. Experts say that the device is non-GPS and will not transmit anything that will reveal the vehicle’s locations. Consumer advocacy groups in other states have expressed concern over the possible violation of privacy with the devices in place.
Spokespersons from the companies that offer the new scheme say that the devices will monitor several aspects of a policyholder’s driving habits. They also add that when installed, the equipment will take not of how hard a driver brakes or accelerates. Aside from keeping track of the car’s mileage, the device will also monitor the times when a driver takes a vehicle on the road. According to statistics, car accidents are more frequent during certain times of the day, especially between midnight and early morning.
Experts say that the new program may not be suited for drivers who are fond of speeding up suddenly and braking hard. Motorists who also go for a spin after midnight should also reconsider before availing of this particular insurance scheme.
Analysts say that mature drivers over the age of 50 can get substantial savings by enrolling in the new scheme. Data from research has revealed that more mature drivers do not get into accidents as much as younger ones. Experts say that on average, drivers who participate in the program can save anywhere from 10 to 15 percent of their premiums every year.