Yet just five percent of drivers are given the choice...
Six in every 10 British motorists would take out so-called 'black box’ telematics-based insurance policies if they could save money by doing so, according to new research.
Sometimes referred to as ‘usage-based’ insurance (UBI) policies, black box insurance uses data about the way in which a driver uses the car to calculate insurance premiums. A device in the vehicle can collect data about speed, mileage and even braking to help the insurer determine how safe the driver might be.
A recent study by leading data and analytics firm LexisNexis Risk Solutions, which surveyed more than 3,000 motorists and found that 60 percent would choose such a policy to save money and improve safety. However, according to LexisNexis, just five percent of drivers are offered telematics-based insurance.
Of the drivers interested in taking out a UBI policy, 42 percent said their interest was piqued by the promise of lower insurance premiums, while 41 percent cited “fairer” premiums. For a fifth (21 percent), meanwhile, the main attraction was that the systems could help them become safer drivers.
And that opinion seems to be backed up by accident statistics. Last year, LexisNexis research showed a correlation between falling numbers of road accidents and rising numbers of black-box policies. According to the firm, the technology has been a contributory factor in the 35-percent reduction in collision rates involving 17-19-year-olds between 2011 and 2017.
However, not everyone is content with the idea of their data being used to calculate insurance premiums. Although the study found that 66 percent of motorists had “no problem” with their data being used in this way, a third of drivers remain less convinced.
Martyn Mathews, senior director of motor and telematics insurance at LexisNexis Risk Solutions said some drivers needed reassurance about how black boxes record their data.
“Our findings should provide a catalyst for the insurance sector to go beyond young drivers to offer the benefits of black box insurance products, such as the potential for money savings and improved driving habits, to a wider audience of motorists,” he said.
“Getting drivers confident in how their driving data is analysed is key. We need to be absolutely clear with customers about how their data is managed, who can access this data and when.
“If we can help more motorists get access to UBI, ultimately it may have a significant positive impact on driving behaviour and could even bring benefits along the lines we have seen with compulsory seatbelts, ABS and road design improvements.
“We urge motorists to ask for telematics policies that will not only help them manage their costs but also monitor their driving behaviour. At the same time, we encourage the government to start to seriously examine data that may show a correlation between telematics policy take-up and the reduction in road casualties in young drivers and do more to incentivise drivers of all ages to take up black box insurance. Wider availability and adoption of these policies can not only help to bring down premiums for drivers of any age but can also help create better driving habits across the board.”