(Bloomberg) -- Esurance, the car insurer owned by Allstate Corp., is seeking to appeal to parents with technology that can disable their children’s mobile phones when they are behind the wheel and provide warnings when they drive too fast.
DriveSafe, available for free to Esurance policyholders who list teens on their plan, consists of a device installed in the car and a smartphone application, according to a statement from the company. Esurance, owned by Northbrook, Illinois-based Allstate Corp., focuses on sales through the Internet, rather than by agents.
Auto-insurance companies have turned to technology to encourage safer driving and, in some cases, help set rates. Progressive Corp.’s Snapshot collects data that is used to give discounts to the safest customers. Esurance, which also offers a usage-based discount program, won’t use data collected by the teen-safety program to set rates, said Danny Miller, a spokesman for the company.
DriveSafe “can help stop teens from texting while driving and make parents and their teens aware of, and hopefully reduce, risky driving behavior,” Esurance Chief Executive Officer Gary Tolman said in the statement.
Phones would still be able to call 911 to report emergencies. Trip summaries are typically available to parents by computer within 5 minutes of the end of a trip, Miller said.
Some drivers have shunned technology tracking behavior amid privacy concerns, Progressive CEO Glenn Renwick said in a conference call Aug. 8. He said about 40 percent of prospective Snapshot customers said “no way in hell” would they agree to the device. The remaining 60 percent were divided among people immediately receptive to the technology and those who wanted to know more, he said.
Allstate, the largest publicly traded U.S. home and auto insurer, had been losing customers for its namesake brand of auto policies when CEO Thomas Wilson bought Esurance in 2011. Miller declined to comment on how many Esurance policies list teens or how much the company invested in the DriveSafe program.
New York Governor Andrew Cuomo today announced the approval of the program by his state’s Department of Financial Services.
“A combination of inattention and inexperience has far too often produced tragic results for teenage drivers,” he said in the statement.
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