Connected car company Zubie signs deal with Progressive

Gigaom

Zubie, the maker of a device that plugs into your car and can help you track how well (or poorly) you are driving, has signed a partnership with insurance provider Progressive. The agreement will let Zubie customers see how Progressive would charge them based on the driving data that Zubie collects. It’s the first agreement of its kind for both companies, but it has been something both firms have been working toward for a while.

For Progressive, which has been a pioneer in usage-based pricing, it wants to start getting out of the business of sending customers hardware in order to track their driving habits. Currently under a program called Snapshot, Progressive customers opt in to a device that plugs into their cars’ on-board diagnostics(OBD) ports and shares their driving data with the insurer. They use the device for six months and then send it back. In return, Progressive charges them based on how well they drive, presumably giving them a lower rate on their insurance. (I can’t see someone who gets a bad rate sticking with Progressive.)

But dealing with connected devices isn’t Progressive’s business and it’s CEO Glenn Renwick has said he is waiting eagerly for car manufacturers to offer the same data or another option to get that data so he doesn’t have to ship anymore black boxes. Zubie offers this chance. Dave Pratt, GM of Usage Based Insurance at Progressive, called this agreement the “first tangible step” toward that goal.

He also explained that while Zubie is the first partner of this type, there could be other partnerships. Progressive is interested in not only car data, but also weather data and GPS data that could help pinpoint the likelihood of accidents or how a person drives. Pratt did say he wasn’t terribly interested in sensor data about people, though. So far, your insurance company doesn’t want to know if you slept well last night.

As for Zubie, this is one of the first options available under a new perks program it is building for its members. They will soon not only see the option to send their data to Progressive in hopes of paying less for insurance, but also see coupons and more when their check engine light comes on or their brakes need attention. Zubie collects a monthly fee for its device to help offset the cost of providing a cellular data connection.

Zubie’s CTO Ari Silkey says it’s that cellular connection that differentiates Zubie from other connected car devices such as the rival OBD port device from Automatic. He explained that Progressive wanted the reliability provided by cellular to ensure that each trip’s data was recorded even if the person didn’t have their phone nearby or a Wi-Fi hotspot. The existing Progressive boxes also use a cellular connection.

Zubie was formed in 2012 as a partnership between Best Buy and OpenAir Equity Partners, a venture capital firm in Kansas City that focuses on the internet of things. It recently raised $8 million from Nokia and auto parts manufacturer Magna International.

Image copyright Zubie.

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