Progressive released new findings from an analysis of five billion real-time driving miles in an early July report, confirming that driving behavior has more than twice the predictive power of any other insurance rating factor.
Loss costs for drivers with the highest-risk driving behavior are approximately 2.5 times the costs for drivers with the lowest-risk behavior. Progressive also found that 70% of drivers who have signed up for its consumer Snapshot UBI program pay less for their insurance.
"For most, the rates they're paying are higher than the risk they actually present--and in many cases, much higher,” said Glenn Renwick, Progressive's President and CEO. “Until now, insurers had no effective way to capture actual driving behavior and factor that into the rates they could offer. But we have made a meaningful start toward personalized insurance pricing that's based on measuring real-time driving behavior — the statistics of one."
(To see how driver behavior insurance plans work for fleets, click here to read “Telematics Drives Big Savings on Commercial Auto Insurance.")
Progressive has been collecting and analyzing real-time driving data for 15 years, and the number of miles it has analyzed has more than doubled in the last 18 months since the launch of Snapshot. Snapshot is currently available in 42 states (and the District of Columbia) across every region of the country, and the data is considered a highly representative sample of auto insurance customers and driving characteristics.
Progressive has found that adding key driving behaviors — like actual miles driven, braking and time of day of driving — can predict the likelihood of a claim far better than traditional insurance rating variables alone, like a driver's demographic profile, age and the year, make and model of the insured vehicle.
Over the past few years, almost a million customers have tried usage-based insurance through Progressive, and customers have saved an average of $150 a year. In the past 12 months alone, Progressive has written more than $1 billion in premiums that include a Snapshot-powered discount.
To learn more about Progressive’s Snapshot, visit http://www.progressive.com/snapshot/