Black Box Insurance

If you want to lower your car insurance premiums and you’re a safe and responsible driver, a policy that includes a black box could reward you with a cheaper policy. This device monitors your driving habits so your insurance can be based on how you actually drive rather than the provider making an assumption based on your age or other factors.

What is black box insurance?

Black box insurance uses a telematics device installed in your car, or an app on your phone, which sends information using GPS systems that providers can then use to assess your driving. If you stick to certain rules, such as mostly driving at quieter times of the day or sticking to certain road types, then the cost of your policy could be cheaper.

How does black box insurance work?

The telematic device, known as a black box, may be installed within your car by your insurance provider (which normally takes around an hour) or in some cases can be self-installed, depending on the type of device the insurance provider uses, in an out of sight place to help avoid tampering. The device then records and sends data using GPS such as:

• Your location
• Time of your journey
• Duration and distance of your journeys
• Average and maximum speed per journey
• How quickly you accelerate
• How harshly you brake
• How controlled your cornering is
• Road type
• G-force (for impact detection)

Providers will then look at the data collected and award you with a driving score which reflects how safe your driving is – the higher the score, the better and safer your driving is seen to be. You can also look at the scores you’ve been given by your provider through a mobile app or an online dashboard. Some polices don’t even require a device to be fitted to your car, but can instead work through an app installed in your smartphone.

Why should I choose black box insurance?

One of the main benefits of black box insurance is that if you believe yourself to be a responsible and safe driver then you’d be able to prove this to your provider. This could then translate into discounts on your policy, although what sort of discount would depend on your provider. However, if your driving data suggests you’ve been driving dangerously (speeding, uncontrolled cornering, harsh braking) then you could see your premiums increase – so a black box policy isn’t guaranteed to save you money.

There are also safety benefits of black box insurance, as your installed telematics device can provide accident alerts to your provider – although not all providers offer this as part of their policy. The accident alert is based on the GPS data transmitted by the black box which can suggest an impact has taken place and is also handy if additional information is required for personal accident cover, provided it's part of your policy. If your provider believes you may have been injured by an impact while driving, they may call the emergency service on your behalf. This can be especially valuable in remote locations and can even save lives.

If your car was stationary when an impact took place, your provider may also call you to notify you of the accident as the black box is able to tell if the car isn’t moving and whether the engine is running or not. This could help you quickly respond to damage to your vehicle, rather than only finding out the next time you need to use it.

Is black box insurance good for young drivers?

Insurance policies for young drivers are often more expensive due to providers assuming that they have a higher level of risk on the road, so providers put a higher premium on policies for drivers under 25.

Black box insurance policies could offer young drivers a way to prove that they’re safe drivers, which could then earn discounts on insurance policies, as well as still being able to add other optional extras that can help younger drivers out in a pinch. However, if you're lucky enough to end up getting a new car earlier than your renewal date, then you'll need to let your insurer know so that you remain covered but it could cause your policy to increase in price.