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Privacy and Lower Car Insurance Rates

    3 minute read

    airplane with data recorderDid you know that the first flight data recorder for civilian aircraft was produced in 1956 in Australia? This device that came to be known as a “black box” in airplanes did not receive much praise early on, but now, this flight recorder is present in nearly every plane. Airline businesses and civilians alike welcome the recorders due to their ability to influence airplane safety design and improve security standards for travel.

    Data recorders in passenger vehicles have seen a similar progression in gaining popularity. Once a novelty item, almost 96 percent of new vehicles produced today contain a “black box” of some sort. The devices, which are about as large as a deck of cards, can save information after a collision — much like airplane black boxes do.

    However, automotive data recorders have sparked a fierce debate between safety advocates and privacy activists within the U.S. The dispute centers on the types of data that can be collected and who can access that data.

    Data Recorder: A Life-Saving Device

    Proponents of data recording technology argue the benefits of having them. Information measured by these devices can help determine the cause of a crash and who may have been at fault. This could ultimately hold the correct guilty party responsible for an accident or identify a faulty part or process within the vehicle itself.

    Furthermore, the data from these black boxes can help automakers design safer vehicles. This, in turn, can lower auto insurance rates for everyone because premiums are based in part on the safety of the vehicle being insured.

    So, what is there not to like about safer vehicles and lower insurance rates?

    Data Recorder: An Intrusive “Big Brother” Tool

    The problem with black box capability arises when it begins to cross the line between gathering helpful information and invading personal privacy. Some data recorders can go as far as identifying radio or Internet use at the time of a collision.  Also, while current data recorders only store information immediately before, during, and after an accident, they are constantly following your every driving move. This raises the possibility of random or ongoing recording of data that could be unknowingly accessed.

    However, of late, driving information and data is being provided back to insurance companies on a voluntary basis by policy holders. The concept of this fairly new approach is that if you are a safe driver, your insurance rates may be lowered as a result. The way this works is you are provided with a device by your company (separate from the data recorder installed by the manufacturer) that plugs into your car and monitors your driving behavior. If, in fact, you are determined to be a safe driver (each company will have it’s own qualification for this) then you may qualify for lower premiums.

    Some would call this an intrusion of your rights, however, at this point it is still voluntary so if it makes you uncomfortable and you decide the trade-off is not worth it, simply take a pass.

    Is There A Solution?

    Since the technology is so new, there are few laws that regulate the scope of data that can be retrieved and who has the right to use any data recorder information. Therefore, a discussion needs to take place contrasting the effects of improved vehicle safety versus an individual’s expectations of privacy. This would include establishing who has the right to view black box data and under what circumstances they can access the information.

    Once the ground rules are set, automakers can focus on making vehicles safer, insurers can concentrate on reducing the risk of accidents and claims, and drivers can be at ease knowing that their privacy rights cannot be violated without valid cause.

    This content is offered for educational purposes only and does not represent contractual agreements. The definitions, terms and coverage’s in a given policy may be different than those suggested here and such policy will be governed by the language contained therein. No warranty or appropriateness for a specific purpose is expressed or implied.