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Insurers will now be able to track driver behavior via smartphones

Lucas Mearian | Sept. 4, 2014
A new usage-based insurance (UBI) software platform will allow companies to track drivers' behavior through smartphone sensors and geolocation services.

The critical mistake that GM made with OnStar, Bonte said, is that the data collection and sharing program was based on a driver opt-out model.

Unless the data connection in an OnStar-enabled vehicle was deactivated, information about the — its speed, location and other data — continued to be collected, even if a driver hadn't subscribed to the plan.

"It was quite complicated to opt out. Of course, the common wisdom is not to do opt-out, but opt-in," Bonte said. "Unfortunately for GM, it was not the first mistake they made or the last. They failed to observe most essential rule in privacy... [and] they were forced to stop using the data."

Agero's UBI platform encrypts the data from the device to the company's private cloud and the data is always encrypted at rest, according to Blecher. All sensor data is stripped off of any "peronally identifiable information" before encrypting and transmitted.

"Agero's platform uses various secure methods to relate the sensor data back to a subscriber. Longer term data is anonymized and stored in an encrypted format for regulatory compliance or to adhere with partner requirements. Agero's apps use best practices and all available secure coding practices along with biometric and other means to secure the data on the devices," Blecher said.

Unlike OnStar, which connected about 6 million drivers to its service, smartphones have the capability of connecting tens of millions of drivers to UBI services. In that one aspect, smartphones will be different from other proprietary, in-car technology, Bonte said.

"They will be a point of vulnerability, which will become huge," Bonte said.


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