Why you'll soon have a black box in the boot
Filed under: Motoring
So what is driving the trend?
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Why?The technology works by recording journeys or driving behaviour. It means that premiums can be accurately tailored to match a driver's exact risk profile. As a result, BIBA says, it can mean much lower premiums for many. Some drivers can save around 25% to 30% and some young drivers can save up to £1,000.
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Leighann Forsyth, BIBA's Head of Communications, said: "The dramatic increase in black box technology follows the rising cost of premiums for young drivers, the decreasing cost of technology, and new product availability from insurance brokers."
Scott Kelly, head of car insurance at Gocompare.com agreed: "Over the last few years we've seen car insurance premiums reach record highs. The outlook for 2012 is little better with further uncertainty for young drivers once the European Court of Justice gender ruling takes effect. Telematics does allow responsible young drivers to take matters into their own hands in a bid to control the cost of their insurance."
Wider appealBIBA also said that women, who are likely to see an increase in motor premiums later this year due to the European gender rating ban, could benefit from reduced premiums from telematics.
It says that sales are set to snowball to around 500,000 in the next two years. Gocompare.com's research earlier this year suggested that 57% of drivers believe they will switch to a telematics or behaviour-based insurance policy in the next five years.
However, the comparison site wants to see more. Kelly said: "The telematics approach has wide appeal - not just with young drivers. However, if it is to expand beyond a niche product there needs to be big name providers in the market, genuine savings on premiums and more communication about the benefits."
Respondents to it research found people wanted better communication to help them get the most from the box. Some 43% want to hear on the benefits of behaviour-based policies, 40% would like to understand how much they are saving on fuel, 33% would like to be able to access data on their driving behaviour via a PC-based dashboard and 29% would appreciate advice on how to improve their driving based on their own data .