There's no shortage of tech giants jumping into the auto industry—hello Tesla!—but one start-up is tackling a niche part of the space that hasn't had much disruption: the car insurance market.
While Apple and Google are working to bring their software to cars, Metromile, a San-Francisco based start-up, has created a device that captures mileage data to determine how much a person should pay for their car insurance policy.
"This device opens up diagnostics and other data to do insurance," said Dan Preston, the company's CEO. "Effectively this is a really cool data problem and there are a lot of really cool things we can do that can open up transparency and build better services for drivers."
Here's how it works: The company offers drivers a free plug-in device that turns ordinary cars into smart cars. The device works with Metromile's smartphone app, called Metronome, and does things such as diagnose the health of the car, locate it and offer tips to help the user with their daily commute. (Metromile also sells car insurance of course, underwritten by National General Insurance.)
Perhaps most importantly, the device measures mileage so that the driver's insurance costs are in line with miles driven. It does not, however, track driving behavior or skill, and does not sell users driving data, Preston said. Metromile's customers' average saving of about $500 a year, he said.
"Google and other tech companies are really concerned with putting Pandora in your car. But there are these other critical areas that have to do with how you actually deal with your car, like its maintenance and repairs, that we are trying to fix," he said.