Black box insurance is an inventive type of car insurance that mainly targets young drivers aged between 17 and 25 years old. Drivers in this age group will look for ways to save cash on their car insurance, which is what the black box aims to achieve.
But how does it work? In this guide, we explain the ins and outs of black box insurance and how it can benefit you.
How does black box insurance work?
Black box insurance relies on a GPS tracker which often comes in the form of a small black box, roughly the size of a smartphone. However, some providers of black box insurance rely on applications for smartphones. A few companies that use black box phone apps include Aviva, Confused.com and Co-operative.
The GPS tracker or smartphone app is installed in the car covered by the insurance policy, and this device is typically placed on the dashboard or in a cradle on the windscreen.
When the tracker is in place, it can monitor the car’s movement and send feedback regarding driving performances. This is known as telematics technology. The GPS is activated before a driving journey and when that journey comes to an end, the tracker/app gives the driver an assessment score.
The score given to drivers is based on things the tracker can monitor such as acceleration, deceleration, speed and cornering. All of this is used to measure how safe a driver performs in a journey.
The black box insurance provider will send frequent feedback on the driver’s performances and all of this can be accessed online, or through the GPS tracker/smartphone app itself.
Based on these scores given on driving journeys, the black box will generate a report to the insurance company and if the data shows the driver is safe then the insurance premium being charged will be reduced. If on the other hand the black box records risky behaviour such as speeding, then the insurance premium will increase.
Is black box insurance just for young drivers?
Black box insurance best fits the target audience - young drivers looking for cheaper car insurance.
A lot of the companies that offer black box insurance will actually exclude drivers over 25 years of age anyway.
Even if you are over 25, however, black box insurance may still be worth considering if you only do a small amount of travelling in your car and mostly outside the rush hour time period.
If you have a son or daughter who drives your car, you may be interested in signing up to a black box insurance policy that offers joint responsibility. This allows you to monitor others’ driving habits.
What does a black box cost?
Usually there is no upfront cost to have a telematics device fitted in your car in order to start a black box insurance policy.
As for the policy itself, the cost of a black box policy is like any other car insurance policy depends on the sort of driver getting a quote and the car they are insuring.
How much can a black box save me?
The annual premium on insurance for both young and older drivers could early on be reduced by anywhere between £100 and £500 when using a black box device.
If you’re ever in an accident in your car, the black box can save both money and hassle as the data recorded from it can deliver clear evidence on which driver was the guilty party.