Aviva were one of the earliest insurers to provide a telematics product anywhere, under their previous name Norwich Union which launched a product under the trademarket “Pay as you Drive” in 2005 only to scrap all telematics policies in a misguided move in 2008. Since then telematics has taken off, and now Aviva – the new name for Norwich Union – is racing to catch up on lost ground.
Aviva’s previous incarnation of a telematics policy used the traditional ‘black box’ device installed in cars. This time they appear to be going down a route that won’t involve such a large initial outlay for each new customer they sign up. The new ‘Aviva Drive’ telematics policy instead simply uses a smartphone app.
They are still testing the waters with the app, and thus Aviva doesn’t yet have a specialist insurance policy designed for telematics insurers. Instead they offer the app to their existing customers and new customers who sign up to a car insurance policy with them. The incentive to sign up to use the app is that you could reduce your insurance premiums by up to 20%, as long as you spend over £400 annually on car insurance premiums with them.
Some might argue that using a smartphone app isn’t true telematics. The app uses GPS signal from the chip in your phone to communicate data about your location to the insurer. This allows them to see data such as which roads you are on, how fast you are driving, and even how you brake and accelerate. However as it relies on having a good GPS signal, something that isn’t always guaranteed, rather than monitoring your cars accelerating and braking directly the data is going to be less accurate than products that have a device installed in your car.
Aviva are clearly still testing the product. It was announced in August 2012 and the company called for 5000 drivers to test out their initial Android app in return for discounts and chance to win iPads. The initial tests appear to have gone well enough for Aviva to quietly roll out the product to more of its customers and expand support for iPhone, but the product still relies on the same short testing period – something we’ll move onto in a moment. During the tests 19% of those who took part managed to achieve the 20% discount, while 50% qualified for a 10% discount. This was in part due to drivers with policies costing under £400 only being entitled to a maximum discount of 10%. Currently even the worst drivers don’t have any increase in premiums, although there’s no guarantee Aviva won’t store the data and use it when quoting on future renewals.
As the telematics involved relies on a smartphone you need to ensure that your phone is capable of being used for this purpose. Apps are currently available for iOS and Android, which are the operating system that power the majority of smartphones. However if your phone is by BlackBerry, Nokia or some other providers you’ll be running a different operating system which isn’t compatible. Also the app works best with newer smartphones which have better GPS chips and better software for linking data from the GPS satellites to information about the location of Wi-Fi signals. Any phone from the last two years should be fine though. Additionally the app used a lot of battery power as it requires the GPS and screen to be on constantly, therefore it’s advisable to have your smartphone plugged in to an in-car charger such as those that slot into the cigarette lighter.
Only 200 miles tested
The smartphone app doesn’t have to be on constantly throughout your insurance policy though. It’s only required for 200 miles of driving, after which Aviva will give you a test score which may allow you to save money on your insurance premiums. As you can choose when to turn your app on this means you can selective about when you use it. If you’ve woken up late and need to rush into work it’s probably not a good time to switch it on. It would even be possible to purposefully drive 200 miles ultra carefully, as if a driving instructor was next to you, just to get a higher score on your policy. If your insurance policy is particularly expensive, for instance if you’re a young driver, then the cost of fuel to do this could be worth the expense.
Aviva will rate your driving on a score sheet out of 10. Even a score of 3.1 will get you a discount, but it’s only when you get a score of 7.1 or higher that you’ll be entitled to the full discount – 20% if you’re premiums are over £400, 10% if they are between £200 and £199. Sadly those who already have cheap premiums under £200 can’t save anything using the app – Aviva claim a full 10% of their customers only pay £198 anyway.
If you’re already with Aviva and know you can get a good score on the app then there’s little reason not to give it a try. However if you’re looking for a telematics policy then it’s likely that bigger savings will be available on other policies which include an actual ‘black box’ device. We remain hopeful that Aviva will fully re-enter the Telematics insurance market and offer a dedicated policy within the next few years.
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