Allstate Launches Usage-Based Insurance Product: What You Need to Know About This Coverage

August 17, 2012

Spring Hill, Florida – Allstate has announced that it will roll out its usage-based insurance product, Drive Wise, to interested employees and Allstate agency owners in additional states in 2012. The device is currently available in Ohio, Arizona and Illinois and focuses on combining telematics technology with potential discounts to participating drivers.

Allstate hopes that this crowdsourcing technique will give employees and agency owners the opportunity to identify ways the device can be improved so that the company can increase its telematics footprint.

By using telematics technology, Drive Wise utilizes what is called the OBD-II Port. This device plugs into the port to track driving behavior.

According to Allstate, once drivers snap the device into the port, which is located under the dashboard on most cars made after 1996, they can go online and track their bad driving habits and see how they can become safer motorists.

Along with becoming a safer driver, Allstate claims that by using the telematics device, customers may achieve a discount on their auto insurance policy. The company said that rates will not increase based on driving scores, but drivers with the lowest mileage and safest scores can earn a savings of up to 30 percent.

Usage-based car insurance rates revolve around where and how much a car is driven. Slightly different than other types of car insurance, this coverage awards cheaper rates to drivers that are rarely on the road rather than rewarding a driver for not being involved in a collision. Usage-based car insurance may use GPS to track how much a person drives. While there are benefits for this type of coverage, as with any insurance policy, you must carefully weigh your options before purchasing this coverage.

Tips for Selecting a Policy

Usage-based coverage can be of benefit for drivers who do not travel very far on a regular basis. Here are a few things to take into consideration when choosing usage-based auto insurance:

• The overall cost of the policy is general less than a standard policy based on current driving patterns.
• In some cases, usage-based insurance includes a GPS system, which some drivers like. However, other drivers find this tracking method to be too invasive.
• While a usage-based policy should include all the coverage a motorist needs, do your research and note the types of coverage available, policy limits and deductibles. Reviewing these matters will only help you should you become involved in an auto accident.

The Advantages

Usage-based car insurance offers motorists who do not typically drive that much or change their driving habits certain benefits, including:

• The possibility of reduced costs compared to standard car insurance coverage.
• Reasonably priced coverage for beginning and younger drivers.
• Should the policy use a GPS tracking system, this can not only be of benefit to the insurance company. This can give your vehicle added protection and make navigation easier.
• You can show the insurance company you really are a safe driver. The usage-based metrics insurance companies tend to be interested in measure acceleration, braking, speeding and the hours that you drive, to name a few. The stats collected can serve as a predictor of your risk of having a serious collision, which is a much more efficient way to collect helpful information on your actual driving patterns than say, your credit score.

Keep in mind that while a usage-based policy SHOULD supply drivers with the same protection of a standard policy, in the event of an accident, you will still need to handle an accident the same way. As always, seek medical attention first and foremost for any injuries. Try and collect as much information as you can about the other drivers involved as well as any possible witnesses. If at all possible, snap some pictures of crash site.

Remember, if you or someone you love is involved in an accident in Spring Hill, Brooksville, Ridge Manor, Weeki Wachee, Hernando Beach or Masaryktown, the best way to protect your interests and rights is to contact the Hernando County Auto Injury Attorneys at Whittel & Melton. We can help drivers that have usage-based coverage achieve the maximum compensation they are entitled to under the law. Contact us online or call us today at 352-666-2121.