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Insurance providers consider young and inexperienced drivers to be the most at risk on the road, meaning they pay more for their premiums. But what if you’re genuinely a good driver despite having little experience? Read our guide to see how telematics or “black box” car insurance policies work, and if it can reduce the price of your insurance.
Black box or telematics car insurance is a specialised type of cover that’s designed to give good drivers cheaper car insurance. A black box device is attached to your car to record your driving performance, which is then used to determine the size of your premiums. The safer your driving, the less you’ll pay for cover.
Some studies show that, on average, black box car insurance saves young drivers around £150 each year on their insurance premium, but other drivers may also be able to save by switching to a telematics policy.
Five steps for choosing the best black box policy for you:
Black box car insurance customers must first have a black box device fitted to their car, which continually measures their general driving performance using GPS technology. This includes how the driver handles braking and turning, as well as the car’s speed, distance travelled and location.
This data is assessed by the insurer and given a score, which is then used to calculate the driver’s next insurance premium. The scoring system typically ranges from 0-100, with 100 representing the safest drivers.
A key reason why younger drivers face astronomical quotes for car insurance is that insurers have no proof that they’re safe drivers. Telematics devices were invented to allow new motorists to prove that they are safe on the road. That’s why black box car insurance is mostly aimed at younger drivers.
You can see how much more drivers under the age of 30 pay for car insurance in our guide to car insurance costs.
However, that doesn’t mean older drivers can’t benefit too. If you’ve seen your premiums increase due to your age, a black box policy could help prove to your insurance company that you’re still a good driver. Ultimately, by driving safely and proving your driving skills, you could see a significant reduction to your premiums.
Drivers between the ages of 17-25 will have a much bigger choice of black box car insurance companies to choose from, but those outside of that age bracket could get a good deal too so make sure to shop around.
According to Finder’s research, motorists can typically save between 8% and 26% on their premiums with a black box.
As car insurance is such a personal thing, you’ll need to get a quote to be able to see whether it could save you money.
That said, for most drivers, taking out a black box car insurance policy is a good way to get a discount on premiums in the long run, provided you’re a safe driver.
Finder’s insurance expert Ronny Lavie answers
That depends on your priorities and how good of a driver you are (in practical terms).
If you’re a safe driver and strictly keep to the rules of the road, then a black box can save you quite a bit of money. You’ll have to keep to speed limits and be super careful though, otherwise you might incur fines that will mean the black box ends up costing you more money than it saves.
You’ll also have to take your lifestyle into consideration. Do you work late shifts or regularly have to drive far away from your registered address (say, to attend school or visit relatives)? If so, a black box insurance policy might not be for you, as it often comes with a curfew and restrictions on how far away from home you can drive.
So, basically, you have to consider what you value more – saving money, or having no restrictions on your driving. If you recently passed your driving test and have little experience, or if you’re an older driver who wants to prove you’ve still got it, you could avoid being automatically lumped into a high risk category by allowing your insurance provider to monitor your driving. If you continue to drive well, your insurance costs will reduce compared to regular car insurance. You’ll have to make some sacrifices for it though, so it’s up to you to decide if they’re worth it for the saving.
Generally speaking, driving a cheaper car leads to cheaper car insurance premiums. This is because it costs less to repair or replace these cars when they get into an accident.
Cars with smaller engines also cost less to insure, as they can’t reach the speeds of bigger engine cars, and so are considered to be lower risk by insurers.
Regardless of whether you opt for black box car insurance or not, you should be aware of the 50 car insurance groups, created by Thatcham Research.
The cars in group 1 are the cheapest to insure, while group 50 vehicles are the most expensive to cover.
The companies listed below all provide black box options, and all these brands were in our customer satisfaction survey. We asked policyholders to rate their satisfaction with their insurance company and whether they’d recommend it to a friend. We’ve shown both for each brand in the table below. Our independent survey of 750 insurance customers was carried out in December 2019.
|Overall satisfaction||Customers who’d recommend||Issuer||Review|
|★★★★★||75%||While fewer Direct Line customers said they would recommend the service, the strength of its policies pushed its overall score up. Customers surveyed called the products on offer competitive and the service helpful.||View deals|
|★★★★★||87%||As Marmalade only offers cover to drivers up to the age of 30, it didn’t quite make our top 10. However, the service did very well in our survey, with customers calling it easy to use and praising the competitive prices.||View deals|
|★★★★★||83%||Most people would be aware of Churchill, largely because of its nodding dog. Love or hate those ads, customers called the service provided by Churchill reliable and helpful. Some were impressed by the claim handling process.||View deals|
|★★★★★||82%||As well as standard car insurance, LV= also offers cover for electric and classic cars. Its comprehensive cover includes windshield damage and replacement locks and was considered good value by customers in our survey.||View deals|
|★★★★★||77%||Hastings Direct’s two main cover options are Direct and Premier. The company also offers Essential comprehensive cover, as well as third party and third party, fire and theft, but there’s not a lot of information available on those.||View deals|
|★★★★★||76%||As one of the most well-known insurers in the UK, Admiral offers a range of cover options, including a combined home and car policy, multi-car cover and temporary car insurance. Customers praised the good value cover and helpful staff.||View deals|
|★★★★★||73%||The largest supermarket chain in UK, Tesco also provides solid car insurance policies. You can choose the Black Box policy for young drivers (17–35) or the standard cover for drivers over 21, which customers reported to be good value.||View deals|
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