From Msn/Money:

Will your car rat you out?

It might tell others how far and how fast you travel -- and how well you drive. GPS technology can cut insurance costs and reassure parents, but it gives privacy experts pause.
By Karen Aho

Got a supermarket discount card? To save a little money, you're letting a grocer track your spending.

The same concept is coming to your car.
A variety of navigational, wireless and sensory devices now allow insurers and authorities to track where you drive, how far, how fast and how well. In return, drivers, parents and employers are saving money on their insurance premiums.

But privacy experts are wary. Once the data are collected, how the information is used is limited only by the imagination of governments and multinational conglomerates.

"These devices have the potential to track you wherever you go, and the question is, who is going to have access to this data?" said Guilherme Roschke of the Electronic Privacy Information Center.

The upside: Safer roads and fatter wallets
Much of the technology is here and expected to become standard. Some ways the pocketbook benefits:

Low-mileage discounts: The auto-insurance industry loses an estimated $2 billion a year to drivers who incorrectly claim low-mileage discounts, according to Quality Planning, a rating company for insurers. (See "How drivers cheat their insurers.")

Insurers such as GMAC and Progressive are on the way to correcting this by offering discounts to drivers willing to electronically record their odometer readings. GMAC now offers a break of 26% and up to those who drive less than 10,000 miles a year.

The day is likely to come, say experts, when all low-mileage discounts will be reserved for those willing to verify their miles.

Anti-theft discounts:Insurance companies already offer anti-theft discounts for vehicles equipped with GPS or other locator devices, and they're common among commercial fleets and rental-car companies, which can also program the devices to send an alert if vehicles go outside preset boundaries.

Teenage-tracking discounts: Several companies are marketing GPS tracking devices to parents. With Safeco's Teensurance, parents can program a GPS unit to send an e-mail when the teen's car violates certain conditions. Did it arrive at school? Has it exceeded 50 mph? Is it more than 10 miles from home? Safeco plans to offer users a 5% to 15% discount on insurance, and others could do the same.

Safe-driver discounts: Ivox, an Atlanta company, has been using GPS units equipped with sensing technology for commercial fleets to monitor driver behavior, said David Alexander, an analyst with ABI Research.
The GPS devices track speed, and other devices sense hard brakes, turns and weaves. Insurance companies then set rates based on the recorded data of the driver's behavior. Alexander expects the service to move into the private sector.

"Right now they offer safe-driver discounts, but they're based on whether or not you've had claims, not on how safely you actually drive," he said. "And if drivers know they're being watched, they tend to be better drivers."
Less time, less fueledicated short-range communications, from companies such as Inrix, will combine sensors in cars, roads and traffic systems to provide real-time road and traffic conditions. Drivers will be warned about unsafe conditions and traffic congestion. GPS units and mapping software will be able to suggest not only the shortest routes but also those requiring less time, less fuel and fewer stops and starts.

"For most people, saving a few cents on fuel isn't going to be a big seller, but finding the quickest way into town or finding the parking garage with the most free spots will be," Alexander said. "It's all about saving time."

An alternative to gas taxes:Federal and state highway departments are already funding research into how to best use GPS devices to collect mileage taxes. The more you drove, the more you would pay toward upkeep of the roads.

A mileage tax could ultimately replace the gasoline tax, which has failed to keep up with road costs as drivers have switched to more-fuel-efficient cars and alternative fuel sources.

Such a system would reduce drivers' incentives to burn less gasoline, environmentalists say. But proponents cite the precision of GPS devices. Mileage taxes could go to the exact town and state that maintains the road used. And time and location data could generate additional user fees, such as congestion fees to reduce rush-hour traffic.

Insuring your car
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No drunken driving: Steve Oberman, the chairman of the DUI committee of the National Association of Criminal Defense Lawyers, says he thinks that within 25 years driving under the influence will be a thing of the past. (See "DUI: The $10,000 ride home.")

By that time, ignition interlock devices, which prevent impaired drivers from starting cars, should be standard, he said. Many states already mandate automobile-breath-test devices for ex-offenders, and less obtrusive devices are in development.

These include infrared beams that measure blood-alcohol levels through forearm tissue, steering wheels that detect chemicals in the skin, algorithms that detect weaving, thumb screens or other biometric identification devices and cognition-recognition tools that require the driver to repeat a code.

The downside: It can be used against you
James Turner signed on the dotted line for a navigation device in his rental car and, the next month, got quite a surprise: a $450 bill for speeding.
The fine, which Acme Rent-a-Car deducted from his bank account, came courtesy of the GPS device's ability to calculate the car's location and speed. Turner had not been ticketed by police.

Turner fought in court and won. But what's interesting is why: The court ruled only that he had not been adequately informed of the consequences of Acme's policy. It did not condemn the technology or its use.
"That's important," said Neil Abrams, the president of Abrams Consulting Group. "The court didn't find wrongdoing. It was not that it was violating the renter's rights."

Envisioning the technology backfiring doesn't take much imagination, especially without much case law to offer reassurance.
What, for example, if you don't want to be found? Oberman recalled a man in a minor one-car accident who, when OnStar responded, declined assistance. Nonetheless, an OnStar worker called police, who showed up and arrested the man for drunken driving.

"I am not in favor of drunk driving, nor is any other criminal-defense lawyer," Oberman said. "But we have to balance our rights of privacy against being overseen by Big Brother."

Or what if the device breaks? One ex-offender, who was sober, ended up calling police for a ride when his ignition interlock device malfunctioned. Devices that read toll transponders have charged the wrong cars, as have red-light-enforcement units.

Will your car rat you out?
A more grave concern, say privacy experts, is the possibility that information -- easier and easier to store -- is later used for purposes outside the owner's original intent.

"We're beginning to leave traces of ourselves in multiple places that will exist for a long time, because memory is cheap," said Jim White, a privacy lawyer.
Improving your credit score and shopping around can help you benefit from new pricing rules.

Will drivers get tickets in the mail because their cars report they were drowsy or not wearing seat belts? Will people be contacted if their movements mimic those of someone under anti-terrorism surveillance? Could authorities disable someone's car from afar?

"I am very concerned about the civil liberties that we give up," Oberman said. "People don't recognize or appear to be concerned about the liberties they're losing until it affects them personally."

If you're concerned about your privacy
Read those privacy statements that companies send, then act:
Consider what information you're providing. "People need to stop and think of it as a significant transaction," White said. "These are all exchanges of personal information."

Choose devices with fewer capabilities. Some might provide navigation without storing data.

Select opt-out clauses that prevent your information from being sold or used. You might have to mail a letter. "The default in this country is that people basically give up their personal information until they tell someone they don't want to," White said. "It's just generally a good idea to opt out."

Know your rights. Federal law protects consumer information. Details are available from the Federal Trade Commission.

Pay attention. If you have opted out but think the information has been used anyway, file a complaint with the FTC or contact your state's attorney general's office.