Telematics insurance: your questions answered

With the rise of telematics-based motor car insurance being touted as a way to bring discount car insurance back to the UK, many drivers are naturally curious about the emerging technology – and industry experts have stepped up to answer many of the more common questions.

Based on satnav technology, telematics devices are small electronic boxes roughly the size of a pack of playing cards.  Car insurance companies that support the technology, use the information gathered by the ‘black box,’ which monitors a motorist’s driving habits, and then transmits them wirelessly back to the insurer for analysis.

Telematics boxes track information such as the types of road a driver travels on, the time of day they were behind the wheel, and how fast they were driving.  Once the insurer examines the data the device sends, it rewards safe motorists by lowering their premiums accordingly.

There are many insurers that currently offer telematics-based insurance, among them being the AA, eCar, Coverbox, Co-operative Insurance, and Insurethebox.  Many of these policies are ‘pay-as-you-go,’ requiring you to purchase cover for 6,000 miles or so at a time.

According to these insurers, safe and responsible drivers could experience premium reductions in as little as 60 days after getting their car fitted with a telematics box.  However, the revers is also true, with motorists caught driving mostly at night, taking corners sharply, or exceeding speed limits experiencing an increase in their premiums.

Industry experts say that telematics-based insurance could be a godsend for many classes of drivers, such as younger Brits, as they have been suffering under massive premium prices for far too long.

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