Understanding Behavioral Economics to Change Behaviors with Big Data

My good friend Vinnie participates in an automobile insurance program that rewards him for good driving behaviors; the better driving behaviors he exhibits, the more money he saves on insurance. You stick a device into the vehicle's diagnostic port (usually under the steering wheel in most vehicles manufactured after 1996), and the automobile insurance company tracks your driving behaviors and offers you automobile insurance discounts based upon the quality of your driving behaviors. The program actually "grades" driving behaviors including acceleration, turning, speed and braking, and once a month sends a report card on the past month's driving performance (see Report Card in Figure 1). And for my friend Vinnie, as a result of sharing his detailed driving data, he saved $1.49 over the past 6 months. Vinnie is saving $2.98 per year by sharing his detailed driving data with his auto insurance company.