How the Internet of Things Will Actually Be Used

It will be invading our privacy and discrimination, all while presenting it as a benefit to the consumer.

You might want to check out this bit of propaganda from the insurance industry courtesy of the Washington Post, and imagine what they would do if they knew what food was in your fridge, or how often you drink, or what you set your thermostat to.

The term to describe this is "dystopian":

For years, insurance companies have used estimates of your annual mileage to determine your car insurance rates. But with recent changes in technology, insurers now have an unprecedented ability to judge your actual driving habits. Armed with detailed data on how often you slam on the brakes and what times of day you're on the road, insurance companies are increasingly relying on precise, technological means of assessing risk — and using that information to set your monthly premiums.

Liberty Mutual, the country's third-largest property-and-casualty insurer, took the latest step in that direction Monday when it announced a partnership with Subaru. Beginning later this year, Subaru drivers who have paid for the automaker's Starlink infotainment system will be able to download an app to their cars that notifies them when they are accelerating too aggressively or braking too hard.

The app is part of Liberty Mutual's RightTrack program, which gives drivers a 5 percent discount on their rates for enrolling and additional discounts up to 30 percent for heeding the app's guidance on driving safely.

Liberty Mutual, which began offering RightTrack in 2012, isn't the only insurer to embrace usage-based insurance — a tactic that draws on a person's real-world driving behavior to gauge his accident risk. Progressive, Allstate and State Farm operate similar programs, too.


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But as more Americans begin buying high-tech, connected cars that can talk to the Internet, other analysts say the rise of usage-based insurance raises uncomfortable questions for consumers and insurance companies alike.

"Don't assume this is always going to be a way to lower your rates," said Karl Brauer, an analyst at Kelley Blue Book. "It could be used against you to raise your rates long before you ever have an accident."

Although many insurance companies say that agreeing to be tracked can only result in a discount, not a rate hike, those terms could always change in the future, Brauer and other analysts say. And people who drive safely one year but more riskily the next could effectively see their rates rise when an insurer decides to grant a smaller discount than before.

Then there's the matter of consumer privacy. How long insurance companies can hold onto your data, and whom they can share it with, depends on each firm's policies as well as state or local regulations. Insurers would also have to obey court orders for user data.But as more Americans begin buying high-tech, connected cars that can talk to the Internet, other analysts say the rise of usage-based insurance raises uncomfortable questions for consumers and insurance companies alike.

"Don't assume this is always going to be a way to lower your rates," said Karl Brauer, an analyst at Kelley Blue Book. "It could be used against you to raise your rates long before you ever have an accident."

Although many insurance companies say that agreeing to be tracked can only result in a discount, not a rate hike, those terms could always change in the future, Brauer and other analysts say. And people who drive safely one year but more riskily the next could effectively see their rates rise when an insurer decides to grant a smaller discount than before.

Then there's the matter of consumer privacy. How long insurance companies can hold onto your data, and whom they can share it with, depends on each firm's policies as well as state or local regulations. Insurers would also have to obey court orders for user data.

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Consumers who don't want to be tracked don't have to sign up. But when such programs become more common, opting out could serve as a "red flag" to insurance companies, according to Renee Stephens, vice president of U.S. auto quality for J.D. Power and Associates.

Insurers find behavioral monitoring attractive because it provides them with a clearer picture of the entire risk pool. By understanding better how each driver behaves, companies can design insurance plans that match a person's risk more accurately and determine how much coverage a given driver requires.

Yes, just trust the insurance companies with your data, allow them to apply opaque algorithms to their systems, and the consumer will always benefit.

Yeah, sure, and Donald Trump does not have a comb over.

The insurance companies will use this to f%$# us like a drunk sorority girl.