A controversial new technology may revolutionize how much we pay for car insurance.
Imagine a future where your driving patterns are monitored, and those determine how much you pay in car insurance.
That may sound amazing or horrifying, depending on how safe of a driver you are, and how much you feared the vision of Orwell's 1984.
Usage-based coverage is based on this technology: a computer chip is placed in your auto, and it monitors your driving habits, how fast you drive, how much you slam on the breaks, how often you drive.
This technology is particularly popular in California, where the Brooklyn Institute Estimates usage-based insurance could save the average driver $276 per vehicle.
Usage-based insurance was the product of Proposition 103, a bill which requires car insurance companies to set rates upon specific, transparent factors.
One of those factors is the number of miles an individual drives in a given year.
Up until now, companies had to rely upon the consumer to tell them how many miles they drove, which has led to a lot of dishonesty, since people know that the more miles a person drives, the more they must pay in premiums.
But the flip side to this technology is the obvious loss of privacy, as people are forced to choose between fair insurance rates or personal privacy.
The electronic monitoring is just the easiest way to do usage monitoring.
There are other ways that require much less invasion of privacy.
You can submit a maintenance record of the amount of miles you've driven since your last tune up, or you can have regular odometer checks given by your auto insurance company.
This compromise encourages individuals to participate in usage-based insurance programs, while giving them the freedom to choose how the information would be gathered.
Many companies are excited by the opportunity to have a more scientific and reliable way of determining risk.
One of the first companies to jump on the usage-based insurance bandwagon was Progressive Auto Insurance.
Progressive recently launched the My Rates program, which installs a sophisticated chip - not unlike a cell phone - to report driving information to the company.
Unlike the California proposal for usage-based insurance, My Rates charts more than just mileage: it gathers information so the company can assess a driver's overall responsibility.
It's still in the test phases, but it could be an excellent choice for safe drivers looking to save money.