Some car insurers offer a discount by fitting a special device, known as telematics or a black box, into your car. This device tracks your driving and feeds back data to an insurer to show how well you drive. You’re usually charged a fixed fee to drive a certain amount of miles a year.
Might a black box policy be right for you?
Black box insurance policies are usually powered by technology that measures everything from acceleration to cornering. This means your car insurer gets a full impression of your driving habits – and charges you accordingly.
Black box and telematics insurance policies work by refunding drivers for good behaviour or increasing the premium for those who drive less safely.
Some telematics policies work like ‘phone contracts, which means you might top up in bundles of miles, depending on how much you drive. That’s why it's sometimes called ‘pay-as-you-go’ insurance
Some policies issue warnings for bad driving – you can often see your own driving record online
A black box is a device fitted to your vehicle that measures how well and safely you drive. This is particularly helpful if you are a young driver or a student, because insurance companies tend to charge much higher premiums for first time and young motorists.
If you can prove, via the black box telematics, that you drive well, this may be reflected in a lower insurance premium. But if you drive badly, on the other hand, your premium might go up.
The black box tracks how and where you drive using GPS – similar to your location app on your mobile phone. It provides your insurer with data on where you are, how fast you are accelerating and driving and whether you brake gently or not. It also gives your insurer a view of your general driving style.
If you are a careful driver, telematics car insurance can count in your favour. Your insurance quote will be based on your own driving, and not on the general risk of someone with your age and risk profile. So you can be rewarded for being a safer-than-average driver
The black box in your car links to a satellite to measure your usage, allowing you to check your own driving online.
The black box typically tracks and measures:
If you brake sharply
Whether corners are taken gently, or not
Instances of sudden veering
Your speed compared to the speed limit on any given road
The time at which the car is being driven
The number of miles you drive
There are a few different black box options to choose from. Which one might suit you best?
Black box: a small device, usually about the size of a deck of cards, is installed in your car and uses GPS technology to track your driving
Plug and drive: this uses a device that plugs into your car’s USB port, OBD socket or 12V adapter. Again, it uses GPS technology to monitor your driving
Smartphone: some insurers can track your driving behaviour by using an app on your smartphone. They use the built-in GPS on your mobile
Black box policies also vary in what they measure. Some are purely mileage based while other policies are based on the driver’s behaviour.
They’re particularly good for new drivers, especially those who have just passed their test. Insurers have no track record on which to base your insurance. Without a black box you may be charged the highest level of insurance, based on your age and inexperience.
Black box insurance is great for careful drivers who are frustrated by the high cost of car insurance.
With a traditional black box and telematics car insurance policy, your insurance provider will send out an engineer to fit the black box behind your car’s dashboard. It will usually take about an hour to install and you may need to present your driving licence and V5C registration document.
The black box will automatically start recording your driving, so you don’t need to switch it on.
If you choose a plug-and-drive device, you’ll be able to install this yourself by plugging it into the charger port.
With a smartphone app, there is no installation at all. You’ll simply need to follow your insurer’s instructions to download the app onto your smartphone. In some cases you may have to start the app before your journey.
In most cases, you can leave a black box in your car for as long as you want to. If your insurance policy comes to an end, your insurer will most likely deactivate your box, rather than remove it. If you would like to have it removed instead, you’ll usually need to pay a fee.
To have a traditional black box removed, you will need to speak to your insurer who will send out someone to remove it for you. If you do it yourself, you may be charged for any damage caused.
If, however, you have a plug-and-drive device, you simply unplug it yourself. If you want to use it in a new car, you can plug it back in. But don’t forget to let your car insurance provider know what you’ve done.
Don’t forget to add removal or end-of-contract costs into your overall insurance budget as it’s important to know the total, or overall, insurance cost for any period of time
You could get cheaper insurance with a telematics device fitted to your car.
Here are four immediate benefits:
If you're a young driver and get penalised with high premiums, despite being a sensible driver, car insurance with a black box could help.
The best black box insurance counts the miles you’ve driven, so you only pay for what you use.
It can help locate your car if it is stolen and can alert your insurer if you have a strong impact. If that happens, your insurer will call to check you are OK, or call out the emergency services.
If you consistently drive well, you could be rewarded by vouchers or money off your insurance when you renew.
If there is a limit on the number of miles you can drive each year and you go over that limit, there may be a fee involved.
However, if you know in advance you need to drive more miles, you may be able to ‘buy’ more. Or your premium may be amended to reflect the higher mileage.
In order to cut the risk of you having an accident and claiming on your policy, your insurer may place some restrictions on where and when you drive.
This might mean you cannot drive late at night, for example, or if you do, that will be factored into your insurance quote and might make it higher.
Some people don’t like the idea that their insurance company is monitoring them and knows where they are and how long they stop for. However, the telematics device will not affect your car’s performance.
Why not read our guide to dispel the myths about black box insurance?
Some insurers can fine you or increase your premium if you’ve demonstrated bad driving behaviours, such as speeding, so you need to be careful how you drive at all times.
If you drive at dangerous speeds on a regular basis, your insurer might even consider cancelling your policy.
When you apply for telematics car insurance, you will need to enter your details, get a quote, and then go ahead with purchasing the policy.
Then your new insurer will contact you to sort out the fitting of your black box.
Once you get a policy and you have your telematics device fitted, you are fully covered to drive – though do check for any curfew limitations.
Some telematics providers offer fixed premiums
Others will regularly review your driving behaviours and could offer you a refund on your premium if you’ve proved you’re driving safely
But the bottom line is that the more safely you drive, the bigger the benefit you will see when it comes to renewal time.
If you are a young or new driver and you are finding it hard to find cheaper car insurance, you could use our broker journey to search for the best cover. You can also consider driving a car with a less powerful engine or one that has a lower value, in order to cut your costs.
Alternatively, you could consider pay-as-you-go insurance.
Normally, pay-as-you-go drivers are charged a set amount a year and allowed to drive a certain number of miles before being charged extra
Pay-as-you-go insurers allow you to top up in bundles of miles which you can roll over to the following year if unused.