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We all want to pay less for auto insurance. But we have to qualify for it first. Consumer awareness of usage-based auto insurance (UBI) has swelled in recent years alongside UBI programs’ growing appeal among young drivers who want discounts on auto insurance coverage, according to OnlineAutoInsurance.com.

UBI programs, powered by an information technology called telematics, use a device plugged into a vehicle to record driving data that can include how far the vehicle goes, times of day it is driven and motorists’ various habits like how often they speed and hard they brake.

That data is collected as information that car insurers can use to determine a driver’s eligibility for discounts and drivers can use to track their own driving habits online, often in real-time.

Several major insurers currently offer UBI programs that advertise premium discounts ranging from 10 percent to 50 percent. Progressive, Allstate, State Farm... they're all offering discounts to drivers who allow the telematics devices to gather the data on your driving habits.

When the 2013 Lexis/Nexis Insurance Telematics Survey came out,
the survey’s most significant finding was a surge in consumer awareness of UBI in recent years. The 36 percent of those surveyed in the 2013 report who said that they are aware of UBI is more than triple the 10 percent that said the same in 2010.

The most recent survey also found that nearly half of consumers “like the concept” of UBI and telematics.

According to the report, awareness is unlikely to wane since UBI programs are most popular among younger drivers. Using several factors, including telematics awareness, telematics interest and smartphone ownership, the study identified drivers between 21 years old and 34 years old as the “sweet spot” that are the “best initial targets for a UBI program.”

The #1 Driver: Discounts
The survey found that the prospect of discounts is the leading incentive for a consumer to enroll in a UBI program, with half of those surveyed saying they would likely enroll for a 10 percent discount and 36 percent saying they would switch carriers for a 10 percent discount.

Other enticements would make a UBI program more savory to consumers, according to the report, which found that 72 percent of those surveyed were more likely to accept telematics if a car insurer guaranteed a 10-percent discount after a policyholder’s first six months as a UBI participant.

Also, 61 percent of those surveyed were more likely to accept telematics if they were offered a three-month trial enrollment period in a UBI program.

A vast majority of consumers also said they would be more interested in a UBI program if they could opt out without penalty, control the data that goes to their insurer and make sure that data is “saved for a short time.”

But perhaps most intriguing element of UBI is its potential to be a game-changer in a marketplace where unique offerings and discounts can be the most effective bait for insurers trying to pry away customers from competitors.

Michael Barry, spokesman for the Insurance Information Institute (III), said he was “not surprised” by the report’s findings about the spotlight on UBI.

“A number of auto insurers have heavily promoted their usage-based insurance policies in states where they’re selling them, so the general public is becoming aware of this technology,” he told Online Auto Insurance News (OAIN).

Of course, some motorists are understandably apprehensive. Thirty-five percent of consumers are uncomfortable with a UBI program sharing pre-crash data that could be used to determine fault, up from 25 percent in 2010, according to the survey.

In addition, 40 percent of consumers are uncomfortable with smartphone GPS technology providing location information and 48 percent were uncomfortable with a UBI program sharing driving data, the latter representing a 2-percent uptick since 2010.

How much information are you comfortable "sharing" on your whereabouts, how you drive, and, how fast?