With new satnav-inspired technology leading to discount car insurance quotes moving into the mainstream, several car insurance companies have begun to offer the new tech in order to remain competitive in today’s market.
Many motor car insurance providers have come to hop up on the telematics insurance bandwagon, with insurers such as Co-op and the AA. Younger motorists are especially attracted to the ‘black box’ insurance, since young drivers are charged exorbitant car insurance rates under traditional insurance schemes, as age is taken into account, not skill behind the wheel.
A recent price index published by Towers Watson found that for motorists between the ages of 17 and 20, premiums have increased by 68 per cent over the past five years. Telematics is instead leveling the playing field for drivers, as only their motoring performance is taken into account in their premium pricing, and many industry experts say that this new type of insurance risk assessment could go far to save the industry.
The idea of judging insurance policy holders by their performance is not anything new, experts say, as telematics insurance is not unlike 17th century risk assessment methods used by the shipping industry. Insurance underwriters used to assess risk values for every ship disembarking from the nation’s ports through a careful analysis of factors such as the route the ship was set to take and the time of year that the voyage was to take place, and modern telematics underwriters likewise track the time of day and the route taken by drivers, though of course modern technology has progressed to the point where a modern ‘voyage’ can be tracked in real time.
This means that telematics-based insurance companies will generate a quite accurate record of a motorist’s driving habits, and as the technology is cumulative, the occasional trips through accident black spots at peak travel times may generate a blip on the radar but can quickly be rectified by a requisite amount of driving on safer roads at off-peak times, experts add.