What you need to know about car insurance rates

Apps track your driving and can be used to influence your car insurance premium.

But how? And can your rates really be raised based on what the app detects?

WRAL 5 On Your Side spent weeks asking insurers how they use the data they collect from their phones and testing apps that collect that information.

How telematics works

Data about when, where and how you drive is broadly referred to as telematics. Insurance companies have been touting for years that you can submit your data to telematics tracking to get reduced car insurance rates.

You must sign up for these programs with your insurer and be sure you are being tracked.

What’s different today is that lesser-known statistical organizations are also collecting data on your driving habits via your phone, and you may not even be aware of it.

Arity is a “mobility data and analytics company” founded by Allstate. They have agreements with apps like GasBuddy and Life360 to collect information about your driving behavior. By agreeing to the terms and conditions of those apps, you consent to the transfer of your driving data to Arity.

Arity provides this information to insurers and others, saying it can help them set more accurate prices for drivers.

In North Carolina, Arity is one of seven statistical organizations that have received approval from the state Department of Insurance to use telematics.

The other companies include Cambridge Mobile Telematics, ISO, LexisNexis Risk Solutions, Octo Analytics, On the Money Analytics and Root Enterprise Telematics.

What can companies do with driving data?

They can be anonymously aggregated to analyse e.g. traffic.

However, in order to use this information to influence your insurance rates, you must give your insurer explicit consent.

Again, many insurance companies have a discount program for telematics services, so if you decide to sign up for one, read the details carefully to understand what sources it uses to obtain your driving data.

How accurate is telematics?

WRAL 5 On Your Side tested the Life360 system, which sends telematics data to Arity, to see how well it detects certain driver behaviors.

Over the course of a week, our team installed the Life 360 ​​app on two different phones and kept them in the same car on the same trips.

There were some inaccuracies:

– One phone recorded an instance of heavy braking, the other did not.

– One phone recorded an instance of rapid acceleration, the other did not.

– One day, there were five recorded incidents of phone use, even though none of the phones were touched while driving.

WRAL 5 ON Your Side also wanted to compare what the caller picked up with what the on-board diagnostics scanner recorded. To do that, we sat down with Mark Smith of Wake Tech’s Automotive Systems Technology.

During one test drive, the on-board diagnostics reader better detected speed changes and more accurately recognized the route we were traveling.

“When the app loses contact with GPS and relies on it to make any determinations,” Smith said, “the rest of the stuff just won’t happen. The rest of the analysis will stop.”

In response to our questions about these discrepancies, Arity sent us a statement that reads, “…our data and models accurately reflect the risks associated with driving and are rigorously validated against a large number of real-world insurance claims outcomes.”

Life 360 ​​referred us to its Driving Speed ​​and Accuracy FAQ page, which says there may be inaccuracies depending on cellular signal quality and device. (( link – https://support.life360.com/hc/en-us/articles/23053597039511-Driving-Speed-Accuracy ))

Can this data be used to raise car insurance rates?

No, not in North Carolina.

The state Department of Insurance told 5 On Your Side that telematics can only be used to lower rates.

“We do not allow insurance companies to charge North Carolina drivers additional fees based on telematics programs,” said NCDOI spokesman Jason Tyson.

How to Find Out Which Apps Are Tracking You

We found detailed information about what GasBuddy, Life360, and MyRadar shared with Arity about their users by going to their terms and conditions and searching for “Arity.”

This isn’t foolproof, but it’s a good place to start to see if any of the statistical organizations operating in North Carolina are collecting data about you through the app.

Statistical organizations licensed to operate in North Carolina:

• Arita
• Mobile Telematics Cambridge
• ISO
• LexisNexis Risk Solutions
• Octo Analysis
• About money analysis
• Telematics of the main company