At Progressive, “we do not have plans to sell driving data as an additional revenue stream,” Jeff Sibel, a spokesman for the insurer, said by e-mail. “We know customers place a lot of trust in us to protect their data.”
Wilson said that customers will be receptive if there’s something in the deal for them, such as a better price for insurance or discounts from retailers in their path.
‘Boom! I’m In’
“If you say ‘I could save you 10 to 30 percent,’ Boom! I’m in,” Wilson said, describing customer reaction. “If there’s value to it, they’ll be willing to do it.”
Holly Johnson, who shares consumer advice through her Club Thrifty blog, has written about being uneasy with Allstate accumulating her driving data.
“It’s kind of creepy,” the Indiana resident said in a phone interview, adding that she might be willing to forgo some discounts to guard her privacy. “I don’t give out a lot of personal information.”
While Allstate may risk alienating some policyholders or potential customers, the company may be better positioned than Progressive to experiment with auto insurance, said Brett Horn, an analyst at Morningstar Inc. That’s because Allstate is also one of the largest U.S. home insurers and sells life coverage too. Progressive relies more on vehicle policies, though the company expanded this year in residential coverage with the purchase of ARX Holding.
Death Count
Jay Fishman, the CEO of Travelers Cos., told investors in February that he was pleased that his company is diversified. If Travelers had to rely mostly on auto insurance, “I’d be really struggling strategically with that,” he said, citing improvements in road safety.
U.S. fatalities per 100,000 registered vehicles fell to 12.6 in 2012 from more than 21 in 1994, government data show. Improved car technology and the crackdown on drunken driving have helped reduce dangers on the road, a trend that could accelerate.