There have been a growing number of articles in the news recently concerning telematics black boxes and how they could potentially help reduce drivers’ car insurance premiums. Car insurance companies claim that telematics devices can monitor the driving habits of their customers and therefore give them a better idea as to how much of a risk each driver is and how much they should cost to insure. However, no one is certain that these new devices are actually beneficial due to the fact that they are not widely used; therefore a journalist from the Telegraph has decided to conduct an investigation.
Car insurance premiums have recently increased for most drivers, however those that have been hit the most are generally young people. At the beginning of his Telegraph article, Jamas Foxall , Telegraph’s Motoring consumer expert writes: “If, like me, you’ve seen a few summers and want to make yourself feel better about your car insurance costs, go on to an aggregator site and change your birth date to make yourself in your early twenties. Alter your no claims discount accordingly and watch the price of your car insurance cover double or more.”
He goes on to discuss how car insurance providers are offering young people car insurance policies that are dependent on telematics in their cars, so that they see how much of a risk each driver is and then alter the cost of their insurance premiums accordingly. According to insurance company Autosaint, the telematics black box starts all drivers on a score of 100, and every time the driver breaks the speed limit or drives dangerously it deducts points. If the driver scores less than 60 points in a quarter they are penalised and their car insurance premiums will increase the next quarter, if they then improve their premiums will decrease.
Autosaint’s managing director Lisa McPherson has also said that the telematics will also help parents have a better knowledge about how their children drive on the road. She said: “Parents might never know how their child drives on the road. This lets them see with a virtual online dashboard. It gives parents peace of mind and helps the youngsters with cheaper insurance. As an insurer, we want young drivers to be able to afford car cover. This can cut premiums by 50 per cent but we’ve seen savings of up to 70 per cent.”
After two weeks James Foxall will be reporting his findings, and here at MotorQuoteDirect we are particularly interested to see what he says, and of course will keep you all updated!