Facebook has put the brakes on insurance company Admiral's plans to offer discounted quotes to first-time drivers based on what they post on social media.

Admiral had planned to launch its 'First Car Quote' app today (2 November), which was billed as giving new drivers and first-time car owners the opportunity to get a lower car insurance quote if their Facebook posts painted them as a potentially safer driver.

The insurance company had claimed the app would only be used to offer discounts to those it deemed as being low-risk drivers – rather than to increase car premiums for those seen as being higher risk.

The app would've worked by analysing details of Facebook posts, such as the wording used in updates and timings for when users had arranged to meet friends.

However, Facebook has halted the scheme after it concluded that using social media information to determine eligibility for insurance discounts breached its rules on how data should be used.

These rules include measures that prevent companies from "making decisions about eligibility, including whether to approve or reject an application or how much interest to charge on a loan".

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Admiral to launch watered-down social media scheme

Admiral is now preparing to unveil a more basic version of the First Car Quote app, whereby new drivers and first-time car owners will be offered a discount for verifying their identity through Facebook.

The insurance company has confirmed the nature of customers' social media posts will not be taken into account as part of the process behind offering a discount. Instead, it will offer a standard discount to anyone who logs in to the Admiral app via Facebook before providing the usual information required to get a car insurance quote (such as your car's registration number, its value and your postcode).

A spokesperson for Admiral says: "Following discussions with Facebook, the product is launching with reduced functionality, allowing first-time drivers to log in using Facebook and share some information to secure a faster, simpler and discounted quote."

Admiral is yet to confirm a new launch date for the First Car Quote scheme.

Protecting privacy 'of utmost importance' to Facebook

A Facebook spokesperson says: "Protecting the privacy of the people on Facebook is of utmost importance to us. We have clear guidelines that prevent information being obtained from Facebook from being used to make decisions about eligibility.

"We have made sure anyone using this app is protected by our guidelines and that no Facebook user data is used to assess their eligibility. Facebook accounts will only be used for login and verification purposes. Our understanding is that Admiral will then ask users who sign up to answer questions which will be used to assess their eligibility."

Churchill already offering social media discounts

Admiral isn't alone in developing schemes to offer discounts to customers based on social media use.

Churchill asks car insurance applicants in the 'discounts' section of its online application form whether they 'like' the brand's Facebook page – if they do, they'll get a discount.

This pilot scheme was launched in August and social media posts are not taken into consideration when determining whether discounts are offered.

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