How do you feel about an insurance company tracking your every move? Knowing where you go and when you go there. Maybe you don't drive as much as you pay for, but how much is your privacy worth to you?

But then one could afford a nice car in an expensive insurance city, say... Philadelphia.

My uncle (and co-founder of better world club: http://www.betterworldclub.com) is a big advocate of pay as you insurance. When I brought up privacy issues with him, he said that progressive's gps isn't very detailed, so they don’t know exactly where you are, just generally. I still wouldn’t want that, but I wouldn’t mind if my car ‘beamed’ how many miles I drove a day to some computer somewhere.

I would prefer to just have the odometer checked periodically. It has advantages and disadvantages but may make sense for a less fine-grained discount on auto insurance, e.g. "You drove 5000 miles less than the projected 15000 miles last year, here is a rebate of $300" or something.

Better World Club is pretty neat. Roadside bicycle assistance.. and

Consumer Tips: Here are some things you should know about auto insurance:

1. DON'T GET IN AN ACCIDENT.

Polamex: It might not help city folk because by using GPS the insurance company could base rates on factors such as the crime rates of where you take your car, the quality of roads, how often accidents happen in the intersections you traverse, etc..

Brette: I agree. I imagine as a pilot program Progressive is only investing so much in the technology. But I could see much more detailed analysis of each drivers habits if this kind of insurance program really starts taking off.

As a final note, GPS can be used to estimate the speed at which you drive. If you are driving down 71 and make it from exit x to exit y in z time, now your insurance company knows how fast you are travelling. No need to get speeding tickets to jack up your rates.

Ryan: on the flip side, safer (slower) drivers would be rewarded as well. Safe driving would be encouraged in a way fundamentally different from the current spotty enforcement of speed limits.

That is true, but I still find it hard to swallow the "you are being watched for your own good" argument.

I dig the idea you proposed of a rebate based on milage not used for a year. The data collection in this scenario is very limited. The GPS thing is just too much though.

I think the GPS thing is okay as long as it stays voluntary. 'Course there are those car black boxes they're talking about too.

Well, Progressive has discontinued their AutoGraph program which uses GPS because it was too expensive. Now they have a program in Minnesota called TripSense where they send you an device that plugs into your OBD port, but it can only be used on 1996 and newer cars. https://tripsense.progressive.com/home.aspx It keeps track of mileage, speed, and time of day, but not location. You periodically take the device and upload the data to your computer and have a chance to look at the data before submitting it to Progressive. This way you have the choice of whether or not to submit it. They only see your driving data once you've sent it to them. This really helps avoid the privacy issue. Also, with Pay as you Drive insurance, low income people will be more able to afford insurance and therefore reducing the number of uninsured motorists. It think it's great and we need to get it implemented in all states as soon as possible.