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Good Driving Apps: Is the Insurance Discount Worth It?

Learn more about insurance driving apps, how they can impact your rate, and why they may do more harm than good.

Safe driving saves you money because it means you’re less likely to get into an auto accident and make a claim to cover the damages from the accident. It shows insurance companies that there is less risk in providing you with coverage.

To encourage safe driving, many large insurance companies have good driving programs where they monitor your driving habits and incentivize you to drive more safely.

However, they set the standards and then monitor your driving habits or the habit of anyone that would use your vehicle. Without regulations or standards to protect you!.

The Basics about Insurance Driving Apps

Considered usage-based insurance, driving apps are offered by insurance companies to incentivize safe driving. With the use of smartphones, the technology has become more widespread since first program in 1998.

These apps or devices monitor your driving and keep track of factors that are considered risky while driving. They let the insurance company decide if you may be more likely to get into an auto accident and file a costly claim.

Some programs require tracking for a set period of time, such as the first 30 days. Most require continuous monitoring to maintain a safe driver discount. In this case, the discount is often applied when the driver renews their policy, sometimes six months after starting to track their driving using an app.

Many of the insurance companies have usage-based insurance programs with apps including Drivewise from Allstate, Signal from Farmers, and SmartRide from Nationwide.

These programs are fairly similar, often with slightly different qualifications for what makes a safe driver.

Although the figures vary by state, about 10% to 20% of customers choose to use safe-driver programs such as these.

Many of the programs claim to provide a discount of up to 10% on insurance premiums for signing up to use the program. As driving habits are tracked over time, additional discounts can be awarded to safe drivers. Sometimes though this tracking can also lead to increased rates. This is especially true if driving habits show patterns that THEY considered high risk.

How They Work

To use telematic technology to track driving habits, many insurance companies require using an app on your smartphone. It tracks your driving performance in real time, using location services or Bluetooth.

Outside of an app, some insurance companies require a device that is plugged directly into your vehicle’s computer to track every detail of your driving habits. The device is plugged in near your steering wheel, to the OBD-II diagnostic port.

In either case, a GPS signal is used to track movement, along with an accelerometer, gyroscope, and magnetometer. Some companies use General Motors’ OnStar to track driving habits.

When using a smartphone app, you can view your driving data. Any time the app detects the motion of a vehicle, it will begin tracking. There are limited options to put the tracker on sleep mode, if you can remember to, when another person is driving, for example. You’ll also view demerits against your driving record and see behaviors such as how often you use your phone while driving.

What They Track and Why it Puts You at Risk

Insurance driving apps track various real-time data related to how, when, and where you’re driving. The apps monitor habits that could include:

The speed you drive
Hard or sudden braking and accelerating
Driving between 12 to 4 a.m. on weekends
The number of miles you drive
Use of your phone while driving

Drivers should consider what information is being tracked and how it may be used by insurance companies. Beyond analyzing daily driving habits to determine eligibility for discounts, many insurance companies use the data for underwriting purposes, when considering claims, and for development and research purposes. Drivers should read insurer’s privacy policies and terms and use for more detail about what is being tracked.

The lack of regulation though makes drivers vulnerable to having their data used inappropriately.

If you were in an auto accident for example, your data would likely be analyzed and could be used against you in an accident. The problem is that these apps don’t have all of the information, such as the other driver’s data. An insurance company could claim that you were at fault for the accident, based on the movements of your vehicle.

These apps put more power in the hands of the underwriters to determine the standards for what makes safe driving.

The data will likely be considered when determining how much the driver will be awarded after filing a claim. Insurance companies could use the data against you to prevent you from receiving coverage you deserve.

If an auto accident results in a lawsuit, the data may be required to be shared in court. It could discredit your case and give credibility to one driver in a liability dispute, for example.

Many newer vehicles already have an Event Data Recorder, or a black box that automatically records this data, which law enforcement can gain access to. Insurance apps, however, also make that data more readily available to insurance companies and anyone they may be sharing it with.

Future Concerns

Some automakers even present access to this data as a selling point. Tesla launched Autopilot insurance coverage last year, where drivers opt in to their insurance coverage being directly tied to the data on their vehicle’s black box.

This could create a slippery slope regarding how your data is used. At what point will it be required that your data is shared between insurers, making it difficult for you to get a new, affordable policy? How long will the information from the app follow you? Will employers begin asking for this information before hiring? These are just some of the concerns many have about sharing their personal or household driving data.

Frost & Remer Advantage

If you want to protect your data and avoid having to meet the insurer’s criteria for good driving, there are other ways to get discounts for being a safe driver.

Frost & Remer won’t literally track your driving habits but does offer a good driving discount on auto insurance policies, among other discounts and bundles options.

Schedule a virtual appointment to discuss your current auto insurance policy or start a new one.

Photo by Stefan Rodriguez on Unsplash

Beware of What Contributory Negligence Means for Your Auto Insurance Coverage

It can be complicated to understand how each auto insurance coverage area would actually impact you in an auto accident, when you need it most.

Maybe you understand your current coverage but now you’re nervous about learning the changes involved with the new Michigan auto insurance law.

When reviewing your new insurance paperwork to decide what coverage options will work best for you, consider an important factor that impacts your choices but isn’t as clearly outlined as coverage limits and costs – Contributory Negligence. We’ll explain what this term means and how it relates to your coverage.

Overall, lower insurance coverage limits could be financially appealing, initially, but could also expose you to greater financial risk in the event of an auto accident.

Because litigation opportunities are now present even in minor at-fault accidents, it’s important for Michigan drivers to understand both the new Contributory Negligence law and Personal Injury Protection reform benefits.

Recent Changes with Michigan’s No-Fault Law

Previously Michigan’s No-Fault Law required drivers to have no-fault insurance. This coverage provided for unlimited medical benefits for the lifetime of the injured person when those injuries resulted from an auto accident, regardless of who was at fault.

These rules have recently changed with Michigan Auto Reform, which went into effect on July 2. When drivers renew their policies, they now have more options for the amount of auto insurance injury coverage they purchase. It is no longer strictly unlimited. Drivers are also now required to have more liability coverage. Learn more about how the changes could affect your policy and your premium here.

When deciding how to adjust your coverage under the new law, you’ll want to understand how your coverage protects you from future financial risks in the event of an accident.

What are the Risks if I Opt-Out of Unlimited Coverage?

No-fault insurance has been provided through unlimited Personal Injury Protection (PIP) coverage. Because drivers can now choose to lower their PIP coverage, they can also lower their premiums. However this comes with risks.

If you decide “NOT” to continue your unlimited PIP insurance, and you or someone else is injured in an auto accident, you lose unlimited coverage for expenses such as:

Long term care; 24/7 if needed.
Residential Treatment Programs.
Home Modification may be limited.
Auto Modifications will not be covered.
Post-Acute Care/ Sub-Acute Rehabilitation.
Rehabilitative costs.
Damage you did to other people’s property.

Once your coverage runs out, you could be held responsible for personally paying these costs for your lifetime or the lifetime of someone else who was injured.

Instead of insurance covering these costs, regardless of who caused the auto accident, courts will now decide who is at fault and who owes damages.

Contributory Negligence and the Increased Chance of a Lawsuit

The percentage a driver causes or contributes to an accident is considered their Contributory Negligence. It means Michigan drivers can be found at fault and be sued for their contribution to an auto accident, under the new insurance reform.

If you’re fully at fault for an accident, you can be sued for all damages from the accident under the new law, including the injured person’s full medical bills and economic loss. This could add up to tens or even hundreds of thousands in unpaid medical bills.

The court system may find you responsible for costs including but not limited to:

Lost Wages
Medical Bills
Long-Term Care
Attorney Fees
Home & Vehicle Modifications / Repairs
Property Damages
Attended Care

There may not be a limit or cap on these expenses.

For example, if you run into a vehicle that is waiting at a traffic light, you’re at fault under the State of Michigan’s rules. In this case, you can be sued for all damages under the new law.

As drivers may increasingly have lower coverage, they may be more likely to file a lawsuit against other drivers to cover their expenses in the event of an auto accident. We estimate that 20% of Michigan drivers have removed or significantly reduced their lifetime benefits under the new law. In Michigan 20.3% of drivers are uninsured.

This places more liability and risk on each individual Michigan driver. If your insurance doesn’t cover the needed expenses, and another driver files a lawsuit against you for further compensation, you may have to use personal financial assets to pay for the damages owed.

How Liability Coverage Limits can Prevent Lawsuits

Having high enough PIP coverage limits and liability coverage may help protect you from being sued by another driver in the event of an auto accident. Liability coverage has two components, Bodily Injury and Property Damage, which can also protect your personal finances. It’s important to understand what the limit you choose can cover.

The average personal auto liability insurance protection that Michigan drivers choose is $100,000 per person and $300,000 per accident.

For example, the hospital care for someone you injured in an auto accident can cost $38,000 per day. If they’re in the hospital for three days, the cost for their care can add up to $114,000. This means the average auto insurance liability limit of $100,000 per person is exhausted in just three days.

Be Mindful of Risks When Adjusting Your Coverage

Michigan auto reform presents many new changes to be aware of, and the new PIP coverage options are one of many.

When you renew your auto insurance, be mindful of how Michigan Auto-Reform affects your coverage. Reach out to your insurance provider to better understand how the changes could impact how you’re covered. From there you can make adjustments that allow you to protect your health and your finances.

At Frost & Remer we’re setting up virtual appointments via Zoom to consult with all of our clients.

Schedule a virtual appointment for a full risk assessment to make an informed decision about your coverage.

Photo by Artyom Kulakov on Pexels

Michigan Auto Insurance Provider: 7 Good Reasons Why You Need One

Because you can’t drive without car insurance here in Michigan, it’s good to find a local company to fill your needs. Frost & Remer, your local Michigan auto insurance provider, is your best choice when it comes to local claims and emergency services. If you haven’t purchased your own local car insurance, we invite you to ponder at these thoughts. The best time to buy may be now:

Driving in Michigan without car insurance only means you are driving illegally.
If you encounter an accident on the local no-fault zone, you will be leaving the victim vulnerable by not providing the car they need to recover from. This means you may be forced to shell out of pocket, which may be a lot of expense for you at the moment.
If you are hit by an uninsured or underinsured driver and you have no car insurance for yourself, your medical care will not be covered by the personal liability package you could have benefited from a local insurance plan.
You will be categorized as being “high risk,” and this will be stated on your driving record. The result? You will have increased auto insurance premiums. Being caught without insurance will push you into the high-risk category and most Michigan auto insurance providers will brand you for it.
A surprising failure in your car could impact your car insurance claims. This may leave you with worse car insurance expenses in the future.
If you have been driving without car insurance for a long period of time, you may have to lie about it in your next application. If the auto insurance company is able to prove your false statements, you may have your car insurance revoked. This means no settled claims, and your investments go down to nothing.
You won’t get peace of mind when leaving your car in Michigan; who knows what will happen? Vandalism and thievery is everywhere, and your car may be next.

Don’t ever try to drive in Michigan without car insurance. If you need an auto policy, contact the experts at Frost & Remer now.

Renewing with your Michigan auto insurance provider? Some thoughts to consider

Car insurance calls for renewal and when that time comes, it might be smart for you to take a good look at your policy and see if it’s still going to work for you. After all, there are many companies who are offering different types of plans which may fit your needs better. It’s better to do some research and discover potential Michigan auto insurance providers who can provide you with better ratings and greater savings.

Comparison shopping is a must, and it’s made easier when you go online rather than do it on your own. Take a look at our tips in making your comparison shopping more efficient:

Don’t just go for cheap. It’s an obvious choice to pick a car insurance company that provides lower automobile insurance ratings, but always discern how they are able to provide such policy. This could involve insuring multiple cars or different types of insurance in the same company. Consider getting new insurance quotes from your Michigan auto insurance agent.
Your location plays a big role in your entire insurance expense. If you’re planning to move down the street or a couple of blocks farther, this could make a difference. Communities have different safety ratings and this means you may qualify for discounts you were not able to have before.
Driving less? Good. If you started to drive less, then it’s good to find another policy that will fit your new lifestyle. The fewer miles your car uses, the more you qualify for better car insurance company ratings.
Bad credit can be improved. If your score rises to a higher notch, then you may want to start finding a new insurance quote. Credit ratings influence the price of your insurance and a higher credit score lowers your premium.
Age comes with favorable insurance ratings. People within the 40-50 bracket gets the lowest rates.

With these tips in mind, you just might be in the position where you can get good quotes from another Michigan auto insurance provider. Start your search today and see the many savings it could give you!

Flat Rock Auto Insurance: Understanding Michigan’s PIP Requirements

20/40/20. That’s the basic and general information one can know about Michigan’s requirements when buying Flat Rock auto insurance. However, there’s more to that fact, and as a local resident, you need to be well-informed about the state law and what kind of policy will you be buying. Many times, customers have relied on their family, friends and other advisors to select their respective coverage, but it is important to understand what the plan really is and how much it can cover.

Michigan’s liability limits are set to the minimum amount of $20,000 per head, $40,000 total per accident, and $10,000 minimum for property damages. The Personal Injury Protection is the aspect of every Michigan policy stating that the auto insurance company is responsible for the medical needs of both involved. Local insurance carriers have various levels of PIP in their coverage.

Some of these PIP policies include:

Coordinated with medical, which allows your Flat Rock auto insurance provider to assist in covering the costs of injuries in an accident. Having employer’s primary health insurance benefits will help lessen the cost.
Coordinated with income loss, which pays you your salary with what your primary health insurance provides. An example would be if your disability coverage (through your employer or company) gives you 60% coverage, the auto insurance company can cover the remaining percent in order for you to receive your full wages while disabled.
Coordinated with loss of medical and loss of income, which includes both of the plans mentioned above.
Full medical assistance, which states that your auto insurance will be paying for your entire medical expenses. This has a more expensive policy versus the above services because the insurance company will be the only one responsible when an accident occurs.

This is only for the PIP, but Michigan has another insurance item known as Property Protection Insurance (PPI). Discover more about it through this blog, or contact Frost & Remer (http://www.InsuranceByFrost.com) for your Flat Rock auto insurance information. Also, see their plans at https://insurancebyfrost.com/auto-insurance/.