Telematics black box insurance offers some of the best savings to young drivers, and can potentially cut your insurance premiums by thousands of pounds annually. By monitoring your usage and rewarding you for good driving insurers can provide much better deals to safe young drivers.
Telematic devices are simply boxes installed into your car that monitor things like acceleration, braking and with the aid of GPS chip your location. This data, along with the time, is sent to the insurer over the internet. You can then access the data from an online control panel which will often give you personalised driving tips based on how you’re currently driving.
If you’re driving dangerously, from bad technique driving at inappropriate times or through dangerous junctions the insurer can use the control panel to contact you to tell you to improve to get better premiums, or with the danger that if you carry on driving badly your premiums will go up.
Often telematics insurance policies are charged based on how many miles you do in your car. This makes them a super good deal for young drivers who only occasionally use their car, for instance weekend trips to the supermarket while a student. The less you drive, the less likely you are to be involved in an accident, so the less the insurer will need to charge.
The idea of a box spying everything you do in your car might seem Orwellian to some, but the data is secure and only accessible to the insurance company and you. Unless they know your password, there’s no way for your parents or friends to see what you got up to on last Thursday so your boyfriend or girlfriend won’t know about that sneaky trip to the kebab shop after the gym.
Nighttime Driving Restrictions
Some telematics policies restrict when you can drive in order to offer you a good deal. A large proportion of accidents involving young people happen at late at night, often because of the involvement of alcohol. In response these telematics policies disallow you from driving at these times, but in return offer you a much better deal than other insurance policies. Some do allow you to drive at night, but with a higher rate than daytime driving.
Not all telematics insurance policies for young people have these restrictions on when you drive though – and all reveal on their websites if they do before you purchase. Take a look at our telematics insurance reviews to get an overview of which do restrict driving hours and which don’t.
The telematics box to buy without insurance generally costs a few hundred pounds, with an added subscription fee for the software and data. There’s no need for young drivers to purchase this however, and only fleets purchase the devices themselves.
Instead the insurance company will provide a box for free in most cases, but might charge you a fee of around £50 for installation. Some don’t have any charges at all, but this is generally reflected in slightly higher premiums.
Premium discounts based on your driving can be substantial, but this really depends on how often and how you drive. It’s hard to give a general figure about how much you can save, and it’s important to keep in mind that bad drivers may pay more using telematics.
How you drive vs How much you drive
The policies generally fit into two broad categories: ones that charge you based on your mileage and others that charge based on your driving technique. Some combine both, or elements of each.
Generally the ones that charge based on how you drive are run by big companies such as the Co-Operative and the AA. These gather data using a GPS chip as well as checking your speed, how you brake at junctions and other factors that indicate how good a driver you are. These are then sent to an online dashboard for you and the insurer to track your driving performance and, if necessary, alter your driving to keep your premiums low.
Milage specific policies tend to be from newer insurers that specialise in black box telematics policies. Often use cheaper devices that don’t monitor how you drive, but not always. Sometimes you’ll be able to pay for only a small amount of milage and top up when necessary, giving you a way of paying for insurance a bit like pay-as-you-go mobiles.
Which is best for you depends largely on how much you drive – infrequent drivers would be best going for the policies that depend mostly on milage, while young drivers who drive almost daily would be better going for the policies that take into account how you drive. If you almost solely use your car for commuting then going for one of these policies that restricts nighttime driving is probably your best option.
Good news for parents
Parents who are worried about their teenagers driving and are reluctant to let them get a car can be reassured if they opt for telematics policies. As their son or daughter is rewarded with lower premiums for safer driving, they have an incentive to stay safe on the road. The reason premiums are cheaper for young people who use black box insurance policies is because they are involved in less accidents.
If you child has a policy that restricts night driving then you can also rest assured they won’t get in trouble with the police for drink driving or worse end up in an accident.
Getting a cheaper insurance policy could also mean that there’s more money to spend on a newer car with more safety features for your child, meaning if they do get involved in an accident the car will protect them.