The number of live telematics-based motor insurance policies, including black box policies, in the UK has increased by 40 percent, according to the latest annual research by the British Insurance Brokers’ Association (BIBA).
These types of policies can offer savings of up to 25 percent for careful drivers. In particular, young drivers who often struggle to find affordable cover can save over £1,000 ($1,435), said BIBA.
In January 2016 BIBA surveyed the 30 leading telematics brands in the UK to determine the number of live policies they had in their books in December 2015.
The results showed a significant increase of 132,000 over the January 2015 survey. There are now almost 455,000 live policies compared to 323,000 in December 2014, the survey found.
The technology usually uses hard-wired ‘black boxes’ in the vehicle to monitor a number of different factors such as time of journey, speed, cornering, acceleration, braking and familiarity of route. These are analyzed to give a risk profile – with the safest drivers enjoying the biggest discount.
Graeme Trudgill, executive director at BIBA, said: “Telematics is becoming the motor insurance solution of choice among young drivers as they can take control of their own premiums by electing to have their driving behavior monitored. Industry statistics show there is a 40 percent drop in crash risk when a new driver has a telematics policy. Telematics equipment also helps reduce theft claims, many doubling as vehicle tracker devices.”
Trudgill concluded: “We are delighted to see these figures increasing, the benefits of a greater take-up of telematics technology are many: more affordable premiums, safer roads, reduced uninsured driving and increased personal safely because some even operate as breakdown locator.”