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This blog is focused on providing information on Pay As You Drive car insurance in Australia. If you find any information, papers, news articles or websites that we should add, please let us know!

Sunday, August 31, 2008

Governator Schwartzenegger: “Enough power saved for 8 x LA”

"Governator" Arnold Schwartzenegger is supporting a website called www.ecodrivingusa.com. Its premise is that with a number of good habits, anyone can reduce their fuel usage by being more efficient. It is compelling stuff. He says that if all Americans follow the practices explained on the website, they can save 15% on fuel. That is enough to power 8 cities the size of Los Angeles. Add PAYD on that, and it is another 4 LA's.

What follows below are their tips on how to be a better, more efficient driver:

Believe You Can Reduce Fuel Use and Emissions

Many of the best practices for green driving are subtle, but they can add up over a year. Making small changes in your driving can be the most effective way to reduce fuel use and carbon dioxide emissions, and the best part is you can do it today, with whatever vehicle you are currently driving. What you monitor, you manage...so start adapting a "lead foot" to a "feather foot" and keep track of the savings over several tanks of gas. Typically, practicing moderate levels of EcoDriving can reduce fuel use by an average of 15%.

Avoid Rapid Starts and Stops

Rapid starts and stops, often called "jack rabbit" starts and stops, use fuel and costs money at the gas pump. Gentle acceleration and braking can save more than $1 per gallon, according to the U.S. EPA, because smart driving can improve fuel economy by up to 33%. A few seconds of high-powered driving can use as much gas as driving for several minutes at more measured speeds. Ease into accelerations and brake smoothly, especially around corners, to raise your mileage the most. Avoid tailgating. When EcoDrivers™ avoid rapid starts and stops, they are not only practicing safe driving habits, but they're also reducing the energy required to get the vehicle moving again.

Keep on Rolling in Traffic

Slow-and-go always is better than stop-and-go, and not just to reduce traffic congestion woes. Maintaining a constant speed in your commute increases fuel economy, because it takes much more energy to move a stopped vehicle than to keep a vehicle moving. In fact, it can take 20 percent more fuel to accelerate from a full stop than from 5 miles per hour. Many truckers practice this approach to reduce shifting ten-speed truck transmissions. Drivers who try to achieve the highest mileage possible, often called "hypermilers", practice looking ahead down the road to anticipate stops and to coast as much as possible.

Ride the "Green Wave"

Traffic lights are often synchronized so that a motorist driving at a specific speed will pass through a series of green lights without stopping. Driving more quickly means you arrive sooner at a light and need to stop. Engineers optimize the traffic light timing to reduce congestion and improve traffic slowly. A steady speed often can help drivers avoid red lights, therefore keeping the car moving more efficiently.

Use Air Conditioning at Higher Speeds

Air conditioning can reduce mileage significantly, by as much as 20%. In fact, your air conditioner can consume up to one gallon of gas per tank to cool the vehicle. But driving with your windows open can produce aerodynamic drag, which reduces fuel economy. What's a driver to do? When driving at slower speeds (less than 40 mph), such as driving in urban areas, open windows are better. At higher speeds (over 40 mph), open windows use more fuel than the air conditioner, so close the windows and turn on the air conditioner. Another good idea is to take advantage of the "recycle inside air" feature. The air that is already cooled in the car is reused by the air conditioning system, instead of drawing hot air from the outside to be cooled.

Maintain an Optimum Highway Speed for Good Mileage

Highway driving that exceeds 60 miles per hour uses more fuel. According to the U.S. EPA, every 5 miles over the 60 mph level is equivalent to paying 20 extra cents per gallon for gas. Observing the speed limit and not exceeding 60 mph (where legally allowed) can improve mileage by 7-23%.

Use Cruise Control

During highway driving, cruise control helps maintain a steady speed. According to a test conducted by Edmunds.com, cruise control can provide a 7% average fuel savings, compared to driving without the device operating. These benefits come largely from driving on flat terrains, according to Edmunds. Cruise control maintains a constant vehicle speed. If you are driving on hilly roads, cruise control may cause your engine to speed up on climbing hills and slow down on the other side, reducing mileage, so use cruise control selectively. Using cruise control on 10,000 of the miles driven in a year could save you nearly $200 and save more than 60 gallons of fuel, according to the Department of Transportation (assuming $3 a gallon for fuel, 20 MPG, and 15,000 miles driven annually).

Navigate to Reduce Carbon Dioxide

Planning driving trips, even Saturday shopping, can help reduce fuel use and CO2 emissions. One of the easiest ways to plan trips is to purchase a navigation system to find the shortest distance to your destination. And, it can make the Saturday shopping trip more relaxing, too.

Avoid Idling

Idling uses gas, but because the car is going nowhere, it translates into 0 mpg. An automobile may burn more than half a gallon of fuel for every hour spent idling, so turn your engine off for long stops. How long is long? As a rule, shutting off your engine for any stop anticipated to be longer than 30-60 seconds saves gas and reduces carbon dioxide emissions. But make safety your highest priority, and only shut off your engine in situations where you are not in traffic, such as waiting to pick up the kids or when you're making a quick drop off or pick up.

Buy an Automated Pass for Toll Roads

Computers make our lives easier in many ways, including reducing fuel use. By purchasing an "E-Z" pass for a toll road or bridge, a driver avoids stopping and starting the vehicle and idling in lines. Special lanes allow drivers to maintain a cruising speed through the toll. This saves time and money at the pump.

Use the Highest Gear Possible

Automobiles are designed to start in the lowest gear possible, because that's where they have the most power, however, power means fuel consumption, according to Edmunds.com. By using overdrive gearing where possible, such as on the highway, your vehicle's engine speed goes down, saving fuel and engine wear while reducing CO2 emissions.

Drive Your Vehicle to Warm It Up

Today's automobile does not need a warm-up period before driving it. Even on the coldest morning, running your engine for 30 seconds is all you need before your vehicle is ready to drive, according to J.D. Power. This is enough time for the oil to circulate throughout the engine. Your vehicle will reach its optimum operating temperature much faster when you are driving, rather than idling. Today's engines are designed to run most efficiently when warmed up, so you want to warm up the vehicle by driving it. During the first few minutes of driving when an engine is cold, try to avoid sudden or severe acceleration. Also, you don't need to step on the gas pedal before starting the engine. Take advantage of a warm engine by "trip chaining", or grouping your trips together. For more information, visit www.DriveLessSaveMore.com.

Keep Your Cool

The inside of a vehicle heats up quickly in summer sun, reaching 120 - 130 degrees Fahrenheit in just 10 minutes. That can mean more air conditioning use, and that means more fuel use. Now, keeping your cool reduces carbon dioxide emissions too. So, always roll down the windows when getting into a hot car to blow out the hot air. Try to park in the shade. And consider investing in a heat reflector or window shades to shield your vehicle's interior from the sun. Parking in your garage instead of outdoors can help keep your vehicle cooler in the summer.

Obey your Check Engine Light

Today's automobiles have sophisticated onboard diagnostics (OBD) systems that continually monitor the operation of your vehicle. When the OBD alert light comes on, there is the possibility that your emissions are increased and your fuel economy is going down. An example would be if the oxygen sensor has failed and the engine controller goes to a default setting - increasing fuel consumption. Replacing a faulty oxygen sensor could result in a fuel economy improvement of as much as 40%. When the OBD light goes on, see your auto dealer for more information.

Friday, August 29, 2008

Pay As You Drive impact equivalent to taking 10 million cars off the road in California

A press release by the Californian Department of Insurance states that if 30% of Californian drivers participate in Pay As You Drive insurance, California could avoid:

  • 55 million tons of CO2 between 2009 and 2020.
  • That is the equivalent of taking 10 million cars off the road!
  • It would save 208 billion liters of petrol.
  • It would save Californians US$40 billion in car-related expenses.

Given that Pay As You Drive theoretically charges people who drive less than average, less for insurance, it would appeal to 50% of the market. The 30% participation figure is therefore quite plausible.

The numbers are quite staggering.

Full press release below. Source: http://www.insurance.ca.gov/0400-news/0100-press-releases/0070-2008/release089-08.cfm

SACRAMENTO - Insurance Commissioner Steve Poizner today announced that he is making a new, green auto insurance option available for California consumers. Pay-as-you-drive auto insurance is a way for motorists to more accurately pay for the coverage they need, by linking their premium more closely with the number of miles they drive. Any incentive like this to get people to drive fewer miles will help reduce greenhouse gases and vehicle accidents.

"I am thrilled to pave the way for California drivers to obtain insurance that is more environmentally friendly and more accurately reflects driving habits," said Commissioner Poizner. "As a strong advocate of healthy market competition and a healthy environment, I am especially pleased to encourage this kind of innovation and additional options for consumers."

The Environmental Defense Fund estimates that if 30% of Californians participate in this voluntary coverage, California could avoid 55 million tons of CO2 between 2009 and 2020, which is the equivalent of taking 10 million cars off the road. This would save 5.5 billion gallons of gasoline and save Californians $40 billion dollars in car-related expenses.  Additionally, the California Air Resources Board has recommended the adoption of pay as you drive as one of the means to meet future climate change gas reduction targets.

Current auto insurance regulations require that rates are based on estimated annual mileage. The new regulations will provide an additional option for actual mileage, or pay-as-you-drive coverage. Commissioner Poizner's newly-proposed regulations will let insurers offer a voluntary option for consumers who are interested in pay-as-you-drive coverage. 

Under the new regulations, consumers could verify mileage by odometer readings, automotive repair records, or a technological device used to collect mileage data. Commissioner Poizner's regulations explicitly prohibit insurance companies from requiring policyholders to participate in a pay-as-you-drive program. A copy of the regulations is available below. 

As a former Silicon Valley entrepreneur who founded SnapTrak, a company that pioneered technology to put GPS receivers into cell phones, Poizner understands firsthand that GPS can be a life-saving tool when used appropriately.  However, Poizner has also said this type of technology does not have a place in pay-as-you-drive auto insurance for privacy and public policy reasons. 

"California has always been at the forefront of technological innovation. A major priority for the Department of Insurance is harnessing this technology to benefit consumers," continued Commissioner Poizner. "At the same time, it is vital that the privacy of drivers remains intact. I will not approve any auto insurance policy that aims to utilize GPS devices in order to obtain location data from consumers."  

California law has procedures in place to allow for public involvement in adopting new regulations. After these procedures are completed, the regulations will take effect - not later than fall 2009. Insurers will then be able to apply to offer this product in California. 

Commissioner Poizner has and will continue to pursue policies that benefit the environment. Currently, Poizner is sponsoring SB 1279 (Sen. Maldonado), which will allow insurance companies to submit paperless filings to the Department of Insurance, significantly reducing the amount of trees cut down by the numerous paper filings the Department receives annually. Last month, Poizner approved the first green homeowners insurance policy in California. 

Click here for proposed regulation.


 

US car crash fatalities drop by 20% following a 2.7% drop in driving

The abstract below is from a research paper with a fascinating result. The US experienced a 20% drop in fatalities caused by car crashes, following a 2.7% drop in mileage driven. The hypothesis of the author (Michael Slivak, University of Michigan) is that the drop in mileage driven is due to fuel prices, but that it is disproportionately skewed to low income drivers, who are also high risk drivers. Combined with that is safer driving as a result of more economic driving. The benefits of a 20% drop in fatalities are huge, both in cost and economics.

Another paper by the Brookings Institute (see posting of 31 July 2008) estimates that Pay As You Drive has the potential to reduce driving by 8%. Clearly the result of Michael Slivak's paper cannot be extrapolated linearly, but it would indicate a drop in fatalities of much greater than 8%.

Abstract of Michael Slivak's paper: Trends in U.S. motor vehicle fatalities, gasoline sales, and distance driven were examined for 12 months from May 2007 through April 2008. The results show substantial year-toyear reductions in motor vehicle fatalities during this time period that cannot be fully explained by the reductions in gasoline sales and distance driven. This is especially the case for the latest two months examined (March and April 2008). Here, the reductions in motor vehicle fatalities averaged 20%, while the reductions in gasoline sales and distance driven were in low single-digits. Consequently, it appears that a major shift in driver behavior might be occurring. This shift may involve disproportionate reductions in distance driven for more risky driving conditions and for drivers with less income (who tend to have higher crash rates), as well as possible reductions in speeds as a means of increasing fuel economy. Should the March and April 2008 trends continue, the 2008 annual fatalities would drop to under 40,000 for the first time since 1961.

Full paper.

Thursday, August 28, 2008

California State Insurance Commissioner backs Pay As You Drive

Excerpt: "I am thrilled to pave the way for California drivers to obtain insurance that is more environmentally friendly and more accurately reflects driving habits," Poizner said at a Sacramento news conference. "As a strong advocate of healthy market competition and a healthy environment, I am especially pleased to encourage this kind of innovation and additional options for consumers."

Source: Los Angeles Times http://www.latimes.com/business/la-fi-insure28-2008aug28,1,5163500.story

SACRAMENTO -- "Pay-as-you-drive" auto insurance -- with premiums tied to the exact number of miles driven each year -- may be just around the corner for California motorists, state Insurance Commissioner Steve Poizner said today.

The commissioner released proposed state regulations that would give motorists the option of using the new rates as soon as next year, and several major insurers said they are interested in offering such plans.

Such policies, available on a limited basis in more than 30 other states, have two purposes: They would give insurance companies a more accurate way to set premiums, and they would offer motorists a financial incentive to drive less.

Currently, rates are based partially on drivers' often erroneous estimates of how much they drive as well as their safety records and number of years behind the wheel.

Under Poizner's proposed regulations, drivers could report their annual mileage in three ways: They could have their vehicle odometer checked by an insurance company representative; they could submit vehicle maintenance records; or they could have an electronic device installed in their cars that would transmit information to insurers.

The proposal is supported by the insurance industry, environmentalists and consumer groups. Environmentalists consider pay-as-you-drive policies an important tool for helping California curb emissions of the greenhouse gases that contribute to global warming.

"I am thrilled to pave the way for California drivers to obtain insurance that is more environmentally friendly and more accurately reflects driving habits," Poizner said at a Sacramento news conference. "As a strong advocate of healthy market competition and a healthy environment, I am especially pleased to encourage this kind of innovation and additional options for consumers."

The Environmental Defense Fund, which backs Poizner's proposed regulations as well as a similar effort in the Legislature, estimates that California drivers would save $40 billion in car-related expenses between 2009 and 2020 if about one-third of them switch to pay-as-you-drive policies.

Environmental Degradation – PAYD contributes to less car pollution

Excerpt: " You might have a question in mind like, "Why am I paying high premiums if I'm not using my car often"? With the pay as you drive insurance premiums, you would be able to quite literally pay as you go."

Source: http://www.insurancearticle.org/pay-as-you-drive-1031/

Nature is one of God's creations. It is one of His best works of arts. But nowadays, the degradation of the environment seems to be unabated. One of the things, which contribute to the gradual destruction of the environment, is air pollution. Studies show that one of the great contributors to this is the smoke coming from the vehicles. Because of this fact, new concept in car insurance is formed - the pay as you drive auto insurance.

The idea behind pay as you drive auto insurance is simple - if you do not drive much, you will pay high insurance premiums. Advocated for this type of insurance policy thinks that there are many merits to this type of program such as the gas consumption, lower costs to the consumer and less air pollution.

You might have a question in mind like, "Why am I paying high premiums if I'm not using my car often"? With the pay as you drive insurance premiums, you would be able to quite literally pay as you go.

Essentially the insurance company will set an average driving amount for each car type. It could be broken down into a cents par mile basis. You would purchase a set of number of miles if you wanted to use the pay as you drive auto insurance system. You would be covered for insurance during this period. For those individuals who do not use their car most often or try to find cost saving methods or environment saving alternative, this pay as you drive system is an excellent idea. Though this type of program is not yet available, there are supporters in many states who are hoping to have this soon.

Environmental Defense, the conservation Law Foundation and even the US environment Protection Agency are some of the groups that are working to organize a national cooperative that would work with insurance companies to offer deep discounts for low-mileage drivers. This is halfway a step towards PAYD (pay as you drive) insurance.

General Motors and On-Star offers PAYD rates. GMAC or General Motor Acceptance Corporation Insurance began offering mileage-based discounts to Onstar subscribers located in some states, in the middle of 2004. To verify mileage, the Onstar system reports a vehicle's odometer readings at the beginning and end of the policy term. Motorists who drive less than the specified annual mileage car receive insurance premium discounts of up to 40%. PAYD program are now available in Israel, South Africa and Holland.

Like in the cell phone plan that you can pay as you talk. The pay as you drive auto insurance is also a good idea. From this little thing, you can also contribute to the renewal of the beauty of nature.

Tuesday, August 19, 2008

Monday, August 18, 2008

Privacy Concerns with Telematic PAYD solved by Real’s PAYD

Real Insurance's PAYD product does not depend on telematics. It solves the problems created by telematics, as discussed in the article below:

Excerpt:

California regulators recently passed Pay As You Drive insurance legislation that would allow insurance companies to place tracking devices in cars and calculate rates according to actual mileage driven. Not surprisingly, privacy advocates are deeply concerned about the implications of the new technology.

"Where I drive, when I get there and whether I stop on the way is not the business of my insurance company or any other corporation who wants to place eyes in my car," says Carmen Balber of the group Consumer Watchdog.

Source: http://www.freshnews.in/new-location-technologies-worry-privacy-advocates-2-52109

New location technologies worry privacy advocates

Millions of people around the planet now carry personal tracking devices with them every day. Their mobile phones broadcast their location all the time. Tech firms and marketers see it as a huge opportunity, but privacy advocates are squirming at the implications.

The worries grew this week.

Web giant Yahoo has unveiled an application called Fire Eagle that allows users to easily share their location via their mobile phone with friends, Internet programmes, their home automation system or anything else that's connected to the world's vast digital net.

Yahoo has made the programme freely available to any developer who wishes to use it. A tour-book company could sell online tours that self-narrate over the phone as users move from landmark to landmark on a visit to London.

"For years, we have been talking about location-based services as the next frontier of the Internet," says Internet development consultant Tim McCullen. "Fire Eagle is a huge step in making that happen."

Yahoo didn't invent location-based services. GPS navigation devices already offer drivers numerous options. But the feeling is that with devices like the iPhone spreading the mobile Internet, the sector is about to take off.

Already 50 programmes are incorporating the service into their applications.

A start-up called Loopt allows you automatically broadcast your location to selected recipients on a real-time basis. Blogging platform SixApart allows users to automatically geo-tag their locations, and the Doppler social network allows frequent travellers to share their locations.

Of course, there are more obvious uses for LBS programmes such as finding the nearest business or service, such as an automated-teller machine or restaurant, navigation aids, and the tracking of people, vehicles or traffic.

But the major beneficiaries could be advertisers, who are drooling at the prospect of sending promotions to mobile users based on their locations - alerting them to special discounts at nearby stores, for example.

The use of location-based services is moving beyond the Internet.

California regulators recently passed Pay As You Drive insurance legislation that would allow insurance companies to place tracking devices in cars and calculate rates according to actual mileage driven.

Not surprisingly, privacy advocates are deeply concerned about the implications of the new technology.

"Where I drive, when I get there and whether I stop on the way is not the business of my insurance company or any other corporation who wants to place eyes in my car," says Carmen Balber of the group Consumer Watchdog.

Yahoo counters privacy concerns by noting that Fire Eagle differentiates itself from other services by the ease with which it allows users to control what information is released about them and to whom.

But that's of little comfort to privacy advocates who note that most people do not delve down into software programmes to customise features.

"For individuals who do not want their location to be known, these services could be harmful," said Beth Givens, director of the Privacy Rights Clearinghouse.

Critics wonder if users will realise that copies of their data will be stored by virtually every application that connects into Fire Eagle as well, making it extremely difficult for anyone to completely erase their tracks.

Telecom expert James Middleton wonders whether the attraction of location-based services may be overhyped, pointing out that people who go to a restaurant generally won't wait until they are standing on an unfamiliar street corner to decide where to eat.

"The industry has been wandering around in circles looking for killer services and applications that might not exist," he said. "As the joke goes, a really useful LBS application would be one that could point you to a really useful LBS application."