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By DONNA SANTI / guest columnist

Would you consent to a vehicle tracking system that is monitored by your insurance company, if it would lower your rates?

Hundreds of thousands of clients currently signed up for AAA and Progressive auto insurance might soon have the choice. The two companies are among the first to launch unique on-board driving data collection programs. Little boxes, about the size of a box of stick matches, plug into the vehicle’s electrical and diagnostic centers and they record vehicle speed, time of day, brakes applications and the number of miles logged. Representatives think the program will create safer drivers and therefore lower premiums.

GPS Tracking & Insurance Premiums

Drivers will be able to access their data on the insurance website by logging in with a personalized code.

Customers can save 10 percent on their insurance just for using the devices; more if their statistics are better by comparison with other drivers under similar circumstances and conditions. For instance, the insurance rate drops if the vehicle is driven fewer than 12,000 miles a year; the national average.

However, there is a bit of controversy dissuading some drivers, and it deals with privacy. The boxes, at programmed intervals, send the data wirelessly to the insurance company’s headquarters. In essence, the driver’s habits can be monitored daily – perhaps hourly – and scrutinized by specialists who attempt to translate real-world happenings into dollars and decimal points.

AAA debuts its vehicle tracking program, called uDrive, this month in the state of Nevada, through a series of open houses. Progressive’s program is called MyRate and it is active already with 100,000 customers in 19 states.

The boxes are not GPS tracking devices, which means the insurance companies do not know, and keep no record, of where the individual clients are traveling. That fact is good, or bad, depending on where someone stands on the issue of personal freedom, versus safety and cost savings.

Some people don’t like private enterprise, or the government, from interfering in or observing what is their personal business, such as by vehicle tracking. As long as an individual is not doing something illegal or potentially harmful to others, they don’t want a computer chip recording where they go, (by logging their GPS tracking coordinates), how long they stay, and then by making a few assumptions, determine what they are doing there.

“How do we know what other kinds of data those little boxes are gathering and who else has access to it,” reacted one insurance client approached about the project. “Who is to prevent lawmakers two years down the line from making this kind of vehicle tracking mandatory? Ten percent savings is not worth it. It’s about control.”

On the other side of the issue are those people that firmly believe “knowledge is power.” The more data GPS tracking and other mobile electronic gadgets can gather; the better understanding we have of human and mechanical tendencies. We can change the wrong to good; fix inefficiencies, improve safety, save lives and save money.

“This is really where the future of auto insurance seems to be headed,” commented a AAA representative operating in Nevada.

The auto insurance companies noted here are not yet offering tracking systems with GPS location service, although they have been proven to promote safe driving habits. Business people, law enforcement, concerned parents and other consumers rely on GPS tracking to tell them what the driver of their vehicle won’t or can’t. Countless fleet management supervisors use GPS tracking systems to monitor their company vehicles and the employees who are entrusted with their care.

A passive GPS tracking system, also known as a GPS data logger, gathers much more data than a small box transmitter. Most significant is that they will record everywhere the vehicle has traveled. This type of information would be invaluable to auto insurance companies because they would then be able to break down their data and examine trends by region.

Many insurance companies today offer discounts to drivers who have purchased and installed their own vehicle tracking systems, because they know they help people drive more safely. Real-time GPS tracking systems help vehicle owners or police authorities recover vehicles that have been stolen. That equates to lower liability and lower insurance rates.

Certainly, insurance companies would love to have access to the data collected by clients’ GPS tracking devices. Would drivers comply if the enticement is a significant insurance discount? Or would it be going too far in surrendering our privacy?