Is Allstate Planning to Spy on Policyholders?

Allstate (NYSE: ALL) is developing technology that would allow the company to spy on drivers and possibly sell driver data, Insurance Business is alleging. The insurance giant has allegedly filed for a patent on a next generation telematics device that would allow it to monitor a wide variety of driver data.

If an Insurance Business article is correct, a process called Traffic Based Analysis would allow Allstate to use cameras and sensors to collect the following information from vehicles and drivers:

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  • Blood pressure
  • Heart rate
  • Phone use
  • What the driver is eating
  • The number of people in the vehicle
  • What the driver is looking at
  • Stereo or radio volume
  • The level of alcohol in the air
  • Where the driver is sitting

Basically, Allstate would be able to know exactly what you were doing in your car and if you were violating the terms of your auto insurance. For example, if you were using your car for Uber or pizza delivery, which would be a commercial use and a violation of your auto insurance policy.

One has to wonder if Allstate could increase your rates or cancel your policy even when you were driving down the road. That means you could be driving without insurance, even if you paid the premium.

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Allstate already gives drivers a discount for installing telematics devices. Is the company planning to provide deep discounts for those that install Traffic Based Analysis?

If that was not frightening enough, Allstate might also be able to use the technology to monitor other drivers or where you were driving. For example, it could raise your rates if it detected you driving after dark or off the road.

To add to the creepiness, Allstate might also sell or share the data possibly with Uber to raise extra cash, Insurance Business claimed. The trade journal reported that Allstate boss Tom Wilson suggested that his company is thinking of selling data about drivers to other businesses. For example, it could sell data about persons that regularly use drive-through windows to fast food operators such as McDonald’s or Shake Shack.

One has to wonder how the public will react to this. The Consumer Federation of America is already on the warpath against Allstate over hysteria about the Spy Car. We also have to wonder when other companies like Google and Uber will start trying to harvest insurance data from telematics devices on cars.

It appears that Facebook head honcho Mark Zuckerberg is right. Privacy is dead, even in our cars.