Progressive Tracks Cars to Determine Rates

A tiny blue box can tell the insurance company how you drive - and adjust your rates accordingly.

If you’re the kind of driver with high insurance rates because you’re stuck in a crummy statistical demographic, here’s your chance to prove your mettle behind the wheel and break free: Progressive’s new MyRate program will electronically monitor driving habits to determine insurance rates. The insurance company announced on Monday that it would begin rolling out the system in Alabama immediately.

Drivers who opt into the program will have to install a small MyRate transmitter in their cars, which will monitor how, when, and how often they drive. Although it may sound like a GPS receiver, the logger actually uses a car’s onboard diagnostic system (the same one that spits out an error code when you get a check engine light) to do the logging. That means it can’t actually tell where you’re driving, only statistics like time and speed.

Drivers who drive less often, at safer times of the day, and in a less risky fashion will receive discounts of up to 40 percent off what a normal policy would cost, depending on much their driving habits cut down on the probability of an accident. Quickly snapping between lanes and slamming on the brakes due to tailgating, for instance, are major no-nos, while leaving the Corvette in the garage during the week and taking it out for Sunday cruises would earn a nice discount.

Currently, the program is only available to drivers in Alabama, but Progressive has plans to roll it out nationwide as other state highway departments approve its use.