High expenses: Finally, OBD-II dongles are a significant cost factor.OBD devices are essentially black boxes that provide little transparency about the kind of information they collect, how it gets passed on to the insurance company, and how it is being used. Policyholders are skeptical towards constant tracking, and with good cause. Privacy concerns: As consumer privacy is becoming an increasingly pressing issue, insurance companies have a hard time gaining their customers’ trust.In hindsight, you won’t be able to determine this number, let alone the amount of premium leakage caused to your company.

By the time your customer re-installs the dongle, they might have driven 10 miles or 500 miles. Policyholders might unplug their device before going on a long trip, and your product will take some time to detect the tamper.

Intentional tamper: Beyond the risk of incorrect installation and unintentional failure, some customers will deliberately commit mileage fraud.

Finally, OBD dongles can draw too much power and cause a customer’s car battery to die. Once installed, devices can easily fail due to a loose connection or if customers accidentally knock them out of place. This lengthy onboarding process causes many prospects to drop off, if it doesn’t discourage them from requesting a quote in the first place. Policyholders have to wait for a package in the mail and spend time installing the device in their vehicle.

Inconvenience and unintentional failure: OBD-II dongles, like all hardware devices, need to be correctly installed and used.

On top of that, if the dongle wrongly detects the start or end of a trip, small imprecisions can turn into significant errors. As you can imagine, inferring mileage from location and trips comes with inevitable inaccuracies. Instead, OBD dongles calculate a car’s approximate mileage information based on its location as well as the start and end of the driver’s trips.

Inaccuracy: It might surprise you, but on-board diagnostics dongles aren’t able to access a vehicle’s actual odometer reading.

While on-board diagnostics dongles (OBD) are versatile and useful for tracking and diagnostics, they are far from ideal when it comes to mileage verification. Why OBD-II dongles are bad at verifying mileage Here’s what this hardware solution lacks and how you can use a successful software-based alternative. Many insurance companies use aftermarket hardware like OBD-II dongles to verify mileage.

Whether we’re looking at pay-per-mile products, usage-based pricing, or traditional policies, mileage verification plays an important role in all kinds of auto insurance products.

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