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tomc88, as you seem to have deduced, the little red clip snaps into the spot on top of the windhshield frame where the microswitch is located for determining whether the top is open or closed. It depresses the microswitch and fools the car (and therefore the alarm/immobilizer) into thinking that the top is shut. False alarms - I suppose if a bird flew in the interior, although that is pretty unlikely, especially if the windows are up (and I always leave them up). Certainly I have never had one. Yes, it will activate if someone reaches in or throws something into the interior (and it should), but that is no different than if someone tried to yank on the door handle to get in a car with the top up.
As I see it, if someone wants to damage your car, it is pretty easy to key it, slash the top, etc., etc. I really don't see any increased risk of damage unless, as has been pointed out, it starts to rain. If there is any risk, I close the top. In addition, if you are going to be away from the car for more than an hour or so, I always close the top just to reduce the impact of the sun's rays.
Brad
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