Allstate Corp and Progressive Corp have reached a settlement for a patent dispute that had been occurring between the two insurance giants, which was over technology that allowed the companies to alter a driver’s premiums based where, how, and how frequently he or she drives.
The dispute began when Progressive filed a lawsuit against Allstate, claiming that the latter had infringed on patents and trademarks owned by the former, which are a part of “usage-based” insurance.
Progressive released a statement that explained that some of its patent portfolios will be licensed to Allstate. Through this, and an overall agreement entered into by both insurers, the trademarks from both companies will be able to co-exist. Neither insurance company has released the details of the agreement.
Progressive has been using the “Drive” trademark, while Allstate has been marketing its own program with the label “DriveWise”.
For the programs offered by both insurers, a device is used in the vehicles of the policyholders so that the frequency of use, speed, frequency of hard braking, and other activities are recorded and the information can be applied to their premiums. It allows the insurers to obtain a more precise and realistic image of the way the vehicle is used.
Both insurers have also been advertising that the use of this technology offers their policyholders the opportunity to use their good driving habits to earn premium reductions of up to 30 percent, depending on the various elements recorded by the device.