Why Are Insurance Companies So Interested In Your Car's Onboard Computer System?

Insurance companies are beginning to view the increasingly advanced onboard computer systems found on many vehicles as mini black-boxes. The data collected by the systems can help determine if a driver was speeding or driving recklessly.

It’s done by capturing data about speed, braking and steering input from what is called an event data recorder. And it’s going to get even more complex — already there are systems on some cars that warn when there’s a vehicle in a car’s blind spot, as well as anti-collision warning systems like the one currently featured in a Volvo commercial.

In a lawsuit, an attorney could make much of data that showed, for example, that a car had warned the driver of a stalled car ahead and the driver did nothing to avoid it.

There is a silver lining to the extra monitoring: mechanics can use the extra sensors to perform diagnostics faster. If you are concerned about driving with Big Brother in the back seat, ask your local dealership what data your car collects. — CAREY GREENBERG-BERGER

Car’s onboard data system could haunt you [Bankrate]
(Photo: Nictalopen)

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  1. itsgene says:

    Wikipedia has a page with a pretty comprehensive list of cars that have “black boxes.”
    http://en.wikipedia.org/wiki/List_of_Vehicles_with_Event_D

  2. itsgene says:

    (Oops – that page only lists US manufacturers. Anyone find lists for foreign cars?)

  3. unamericanvalues says:

    This seems surprisingly reminiscent of George Orwell’s 1984, with Big Brother riding in the back seat with me following me where ever I go. I’m sure the Bush administration besides authorizing illegal wire taps, search warrants, and domestic spying is using this technology to follow 87 year old Selma to the grocery store. I can defiantly see how this technology could help in the terms of accidents, but I can also see how this technology hurts America in the terms of the government has a way to follow you wherever you go.

    What has society come to?

  4. catnapped says:

    @unamericanvalues: If there’s a terrorist hiding in your trunk you’ll be glad you had a black box in the car!

    /snort

  5. jitrobug says:

    I can’t help but see it the other way.

    I had a friend who got sandwiched between somebody on the freeway who stopped in front of her and somebody behind who didn’t stop till they were almost in the back seat of her station wagon.

    The guy in back claimed that, in spite of not seeing enough to, you know, stop, he did see that she’d hit the car in front before he hit her – which wasn’t true.. at the scene, the police blamed the car who’d stopped in the middle of the freeway.. which left both of them more than happy to collaborate on a story that pinned part of the blame on my friend.. so, a black box that showed that her car came to an easy stop, followed by a very fast acceleration and another stop, would have helped immensely.

  6. tobi680 says:

    When there is an airplane crash, the black box is all the media can talk about. I think if anyone who had a loved one who was killed on an airline that refused to install black boxes on their airplanes for their privacy would be pretty angry. The thought is since the pilot has other people’s lives in his hands, both he and the airline need to be responsible and that black box keeps them in check, if they screw up there’s a record. I would want to know who’se fault it was if I lost someone in an airline accident.
    I would also like the opportunity to know who was at fault if someone killed a loved one in a car crash. Why are pilots forced to have their every decision recorded, but some idiot taking other people’s lives in their hands by getting behind the wheel isn’t?
    Here’s a thought, if you’re a bad driver and your car can prove it you should pay more for insurance. If you’re a good driver and your car can prove it, you should pay less for insurance. That’s the whole point of insurance. The only people who would be against having their insurance company actually see how they drive are the ones who should be paying more.

  7. a says:

    Yeah, I’m failing to see how this can be bad for a consumer unless the person were trying to scam the insurance company.

    My friend works for a surveillance company and I could say BOO BIG BROTHER, except it’s helped the owners get money from insurance companies when they were trying to stiff them, gotten criminal’s faces on camera, gotten workers slipping bills out of registers. Damn you, Big Brother, for finding legitimate criminals and winning over stingy insurance companies!

  8. 2Legit2Quit says:

    How about the “black box” being used against Jon Corzine’s trooper that was driving the SUV. It can even be used against the government :)

  9. formergr says:

    It’s bad for the consumer if you were speeding, I guess.

  10. zolielo says:

    I am not going to say how but if one wanted the “EDR” (1553 bus, CAN bus, and similar) can be countered before or after the event.

    So if one does not like having the system or has some other requirements for having it off, a bit of digging on the net should yield the information on how to disable it.

  11. GearheadGeek says:

    Insurance companies are in the business of collecting premiums and MINIMIZING payouts, they’re not in business to protect you and they are not your friend. Black-box data will be used to help them minimize claim payouts. For example, it’ll be used by the insurance company of the schmuck who turns left in front of you to show that you were driving 5 mph over the limit, therefore breaking the law and “contributing” to the collision.

  12. alhypo says:

    This sort of thing is great for the people who actually follow the rules. Insurance companies must charge enough in premiums to cover their expected losses. The risk is distributed among all of their customers, however, some customers are clearly more risky than others. The less information they have about how risky each customer is, the more evenly they need to distribute the cost of premiums. In other words, the safe drivers pay more than they really should and the dangerous ones pay less. A “big brother”-type system will provide them with much more information with which they will be able to identify the risky drivers and shift the cost burden to them.

    You will always have the option of disabling your system and opting for an insurance company that doesn’t consider such information. (If you don’t have this option then I would say you have a valid concern.) But by turning the system off you loose the potential benefit of having evidence in your favor when you are not at fault.

    I would actually volunteer to have some sort of spy system installed in my car in order to get lower premiums. Besides, I always think of “big brother” as having more to do with government. Presumably, the government will only be permitted to access your data box if they have probable cause or a warrant (or whatever they need; I don’t know).

    Disclaimer: I am studying to be an actuary, but that has very little bearing on my opinion here.

  13. magic8ball says:

    My concern is that insurance companies will start forcing you to have a black box by charging you more if you don’t have one, or even refusing to insure you if you don’t have one or turn it off.

  14. Demaskee says:

    My issue is not with the insurance companies, it’s with the dealerships. These systems can cause your warranty to be voided based on simple things such as not warming up your car for 10 mins prior to driving as the owners manual states.

  15. Mr. Gunn says:

    OnSpy, Can I help you?

    – wherein it is shown that the operator will call the cops on you if the system is activated and you do or say something that they don’t like.

    Now all they have to do is use the onboard data to automatically activate the system in response to “suspicious” data patterns and they’d have you.

  16. Mr. Gunn says:

    magic8ball: You mean like this?

  17. Mr. Gunn says:

    alhypo: “If you’re not doing anything wrong, you shouldn’t mind being spyed on/searched at random.”

    This is correct, but the definition of “doing something wrong” keeps changing, so this only works if the people making the rules can be assumed to be incorruptible now and forever. That’s a lot to put on anybody, and puts all the power in the hands of those responsible for oversight.

    I suppose you’d give insurance companies open access to your medical records too, if you thought it’d lower your health insurance? Why don’t you try that for a while and let us know how it works out for you.

  18. Trai_Dep says:

    Anyone that thinks that the insurance companies will use this data to help its customers or lower rates is a FOOL. Remember when mandatory insurance laws were passed under the promise of lower premiums for all?

    That worked out great! For insurance companies.

    Now the State forces you to get insurance (good to have everyone insured, sure, but…) yet premiums are higher.

    If there’s a way for insurance companies to screw consumers with this data, they’ll find it. They’re ingenius that way.

  19. vanilla-fro says:

    These do help insurance companies not pay out as much…..by not paying for damages to the at fault person’s car. I work in insurance and I have saved a company a bit of money by getting black box data. if the insured and the claimant have two totally different stories, how else do you know who caused it? when i saved the money, it was’t at the insured’s expense. He actually got to keep the same rate after this accident. at least with his company at that time.

    sometimes being paranoid doesn’t really mean they’re out to get you.

  20. vanilla-fro says:

    oh yeah, it only keeps a few seconds of info anyway. and those are the last few seconds. it doesn’t record where you were going or have gone. that trip to the brothel…they don’t know about it.

  21. alhypo says:

    @Mr. Gunn:

    I would definitely give them access to my medical records if I thought it would lower my medical premiums. I’d be a fool not to. And when I get to the point where it is no longer to my benefit, I would stop giving them access and pay the higher premiums.

    Being a safe driver and tolerating an anonymous corporation looking over my shoulder is totally worth saving money to me. I agree completely that this should be optional and I would have the utmost concern if it wasn’t. Even if insurance companies do require such a system there will always be a competitor who doesn’t. There will almost always be a company willing to insure you regardless of your situation. Drivers with multiple DUIs still manage to get insurance.

    I understand the hostility towards insurance companies, but trust me, you do not want to get insurance through a company that just throws money at people unquestioningly. Then the cash is just as likely to end up in the hands of people who don’t deserve it and your premiums go towards paying fraudulent claims. So, yeah, the insurance companies try to pay as little as possible, but isn’t that exactly what you would expect them to do?

    I imagine a system that takes any doubt out of what exactly happened would only expedite the appropriate reimbursement. And if the insurance company is trying to screw you over, as you suspect, consider how nice it would be to have such evidence in your favor.

  22. shdwsclan says:

    *Cough* *Cought*
    This system can be reprogrammed, especially after an accident or before an emissions test to reflect favor on the owner…..

    Since the system is standardized and all, you can just rewrite its memory.

    Examples: You modified your vehicle so it no longer has a catalitic converter…well, you can put some math in there so that you, in effect pass the emissions test….since dyno testing is only done for old cars…

    You were going 60 mph and collided with a car that was going 50mph in the same zone…side swiped them….or whatever…
    Well, you can rewrite the memory of the blackbox that you were actually going 35 mph and the other party was at fault since they were going faster…

  23. rugger_can says:

    Motorcycle’s FTW..

  24. Saboth says:

    @alhypo -

    Sure that system would work if insurance companies were fair. Did you notice a lower premium when states started to force you to wear seatbelts? No. They kept rates the same, yet their payouts are smaller because people are less injured due to being forced by the government to wear seatbelts. Same goes for these black boxes. They will analyze the accident, and come to the conclusion you braked .5 seconds too late to avoid that stalled car, and give you 50% less of a payout.

    Hell, I have a 100% perfect driving record (no tickets, no accidents), and I pay more than my girlfriend that has like 10 tickets and 5 accidents. Does it actually sound to you that insurance companies do anything besides collect as much money as possible while paying out as little as possible? This deal is anti-consumer all the way, and just another case of government catering to special interest lobbies (insurance companies in this case).

  25. thewaz says:

    @unamericanvalues: if you had a family member die in a wreck, wouldn’t you want to know how it hapenned?

  26. I’m surprised no one has mentioned that these black boxes don’t always give the correct information.

    I was watching something on the news awhile back and they were talking about people who have had these things report that their vehicle was going much faster than the evidence collected at the scene shows. One guy in particular had this thing report that his vehicle was going 20mph faster than he said he was driving…even though his vehicle wasn’t capable of driving that fast.

    Despite this these things are never checked to make sure that they are functioning properly.

    If I can find the report online I’ll post a link to it.

  27. Indecision says:

    @Rectilinear Propagation: “I’m surprised no one has mentioned that these black boxes don’t always give the correct information.”

    Doesn’t surprise me one bit, given that my GPS has my top speed recorded at 455 mph. I had no idea my 2-ton, 4-cylinder vehicle could go that fast. I must’ve blacked out when doing it, too, ’cause I sure don’t remember that.

  28. vanilla-fro says:

    Who is actually getting paid 50%less than they are actually owed by their own insurance company??? is this because they pay you for a depreciated amount? yeah they do that because it says in your policy that they owe you for the value of the vehicle at the time of the accident, not what you paid for it two or more years ago.

    and these boxes have been on several makes for at least 4 years now. I think GM was one of the first.