The moment Jacob Sevlie pulls out of his driveway, he knows he's being watched. Not by Big Brother--by Progressive Car Insurance. Sevlie is one of 5,000 Minnesota drivers invited to participate in a yearlong pilot program for the TripSensor, a matchbox-size device that monitors how fast, how far and at which times drivers travel. Based on this info, Progressive reduces drivers' insurance policies by 5 to 25 percent.

But even the most conscientious drivers shouldn't expect the full discount. While Sevlie, who received his first discount two weeks ago, labels himself a safe driver, he earned only an 11.5 percent discount, or $15 per month. "You'd get 25 percent if you parked your car in the garage and never drove it," he says. Explains Progressive general manager Jim Haas, "People who drive less are less likely to have an accident."