Allstate launched a new voluntary program that rewards safe, low-mileage Illinois drivers with lower car insurance rates.
Auto insurance premiums discounted for data
Allstate plans to expand the "Drive Wise" program to other states as early as the second quarter of 2011. Participating customers get an immediate 10 percent discount for joining during the first policy term. In subsequent policy terms, discounts of up to 30 percent will be based on customers' driving behavior and mileage driven. Rates will not go up based on driving scores, but they will go down for safe driving and low mileage.
Drivers who enroll in the program receive a wireless telematics device that plugs into the vehicle's onboard computer through a diagnostic port, which is under the dash on most car models. The device reports the number of miles driven, time of day, hard or extreme braking and maximum speed to the insurance company. Hard, sudden stops and speeds over 80 miles per hour lower performance ratings.
Tracking improves safety, tests show
The program's design is based on consumer research and the experience of hundreds of employee volunteers, who logged almost 2 million test miles. In one employee test measuring hard stops, aggressive starts and swerving, the percentage of participants scoring in the ideal "safe zone" tripled from 25 percent to 75 percent over the course of the test, the company said.
Other car insurance companies have introduced mileage-based programs, including Progressive, GMAC, and American Family Insurance. Most recently in California, State Farm and the Automobile Club of Southern California introduced mileage-based discount programs.