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What are Black Boxes?

Black box insurance also known as telematics is a type of car insurance policy that calculates the holder’s premium based on the way they drive. The black box is a small device that is installed in your car to monitor your driving. The box measures where, when and how you drive, so a personalised renewal quote can be calculated.

Black boxes are designed to encourage safe driving and collect various driving data including:

  • Total mileage
  • Total number of journeys
  • The time of day or night you drive
  • Motorway miles
  • Your speed on different types of roads
  • If you brake or accelerate sharply

All the data is then analysed by the insurance company, to provide the policyholder with an accurate future quote. This data can help you get a cheaper renewal if you are a safe driver.

What’s inside the box?

Typically, the device contains 4 elements:

  1. GPS system, to understand where and when you drive.
  2. Motion sensor to track how you drive.
  3. SIM Card to send the information back to the insurer’s database.
  4. Software to control how the information is analysed and communicated.

How is it installed?

A black box can be fitted to most cars. Some black box insurers will offer a smartphone app, so there is no need for a black box. However, if your insurer does not offer an app, you will need to get a GPS tracker installed in your car. There are some black box devices that you can install yourself, but this will depend on the insurance policy you have taken out.

Self-fitted trackers are installed on your windscreen and connect to your cars power source through the USB port. Professionally installed black boxes are typically fitted internally behind the dashboard by an engineer.

Pros of Black Box Insurance

Here are just some of the reasons why having telematics installed can be beneficial.

Good driving can lower insurance premium – It can save you money if you are identified as a safe driver from your driving data.

Stolen cars can be tracked – some black boxes also work as a theft tracking device, so if your car is stolen, your insurance provider may be able to locate it.

Encourages safe driving – Research by the RAC found that 62% of policyholders believe the device – and its Driver Score feature – make them safer on the roads.

Accident evidence – If you are involved in an accident, in most cases the black box can be used as evidence, for example, to prove you were driving at the correct speed.

Cons of Black Box Insurance

Here are some of the negatives relating to telematics insurance.

‘Bad driving’ could raise insurance premium – this insurance is designed to encourage safe driving, so sharp braking or acceleration could lead to a higher premium.

Hidden Fees – It is important to check what fees are added to your insurance policy. For example, some insurers charge a fee to install the box in a new car.

With some insurance policies coming in on the expensive side, especially for younger drivers, it’s certainly an option to keep in mind to help keep costs to a minimum.

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