Whether or not you agree with the data-gathering practices of the government and private and publicly held companies, there is no doubting the fact that various entities want to know as much about us as possible. Insurance companies, of course, feed on data that helps them assess risk. For example, the more auto insurers know about drivers’ specific behaviors, the better they are able to properly price premiums. Even now, some insurance companies are collecting data about driving habits by analyzing the data collected by sensors in policyholders’ vehicles. These sensors are able to record information about what routes are driven, the number of miles driven, the time of day, speed, and braking patterns. Call it “custom risk assessment.”
NOTE: By comparing the driving data of one person with statistical information of similar drivers on similar routes and similar times, insurance companies may be able to tell if a chosen driver is an above- or below-average risk, and charge accordingly.