Car insurance companies offering new tech to cut costs

With car insurance rates soaring by 30 per cent over the past 12 months, according to the AA, car insurance companies have begun to offer new technology to cut customers’ costs.

New telematics technology has been growing in popularity.  Through the use of a so-called ‘black box’ that keeps track of a given motorist’s driving style and reports back to the insurer, providers can offer personalised premium prices that can result in discount car insurance.  Many insurance companies have introduced telematics devices with a particular eye towards encouraging younger drivers to drive in a more responsible manner, which can lead to reduced premium prices.

The logic behind the endeavour is simple indeed, since careful, responsible drivers are less of a risk to ensure.  However, the technology has become so affordable that industry experts have begun to predict the advent of a mass-market rollout, as doing so will improve driver safety, lower motoring costs, and reduce insurance premiums.

In an example of one such claim, one telematics-based car insurance provider, Insurethebox, said that two out of every three of its policyholders who renewed their cover in July and August saved significantly as a direct result of driving carefully.  Insurethebox, which launched last year, added that the average savings was 22 per cent, though some policyholders saved more than £800.

Insurethebox offers a 6,000 mile policy, which includes its ‘ClearBox’ telematics device installed under the bonnet.  The little black box, which is roughly the size of a smart phone, keeps track of drivers’ performance and activity by recording any accidents as well as data regarding acceleration and braking, speed, distance, and time of day traveled.

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