Last updated May 26 2021
Black box insurance, otherwise known as telematics insurance, is a type of car insurance offered by some insurance providers. It involves the insurer installing a tracking device, the black box in question, in your car and can result in a lower overall insurance premium.
Choosing black box insurance can be beneficial to new or young drivers with little experience or no NCD (no claims discount), helping to keep their premium affordable until they become less risky to insure.
The tracking device, or black box, that gets installed in your car as part of black box insurance monitors your driving using GPS and scores you on areas such as braking, cornering, speed, mileage, and the time of day you drive. This data is recorded by your insurer and used to assess your risk profile in more detail. You may be sent updates from the insurer on your scores – some offering suggestions for improvement and others providing information on what factors you score highly in.
Your score can then affect your premium price. Generally, the better and safer your driving the cheaper your premium will be. Some insurers will send warnings if you are consistently driving badly and can even cancel your insurance if you fail to improve.
Black box insurance can benefit young drivers under 25 years old or new drivers of any age with no established No Claims Discount. These are the groups of people that insurers may see as ‘high risk’, but black box insurance allows you to prove to the insurer that you’re a safe driver through ongoing monitoring of your driving.
There are many benefits to choosing a telematics policy, particularly if you are a young driver or somebody with little driving experience. These include:
Some telematics insurance policies also have specific rules you will need to follow, as well as driving safely. These may include:
Black boxes can be fitted to any car and model. Some companies may include an installation fee and send someone out to install the box for you. However, some may post the telematics device with instructions for you to install it yourself. In either case installation should be straightforward.
When your policy has expired and you no longer require your telematics device to be installed, your insurer will either send somebody to remove the device or provide instructions on how to do so yourself. If you have a device that you’ve installed yourself, some insurers may require you to post it back to them.
Finally, the question you’re probably here for, is black box insurance for you? If you drive often and go on long journeys, or if you travel during peak times, telematics insurance may work out more expensive than a regular policy for you.
However, if you are a young driver (under 25) and travel shorter distances; black box insurance may benefit you. As with all types of car insurance, it’s best to compare policies and assess the cost of each with the features. There are so many variables that affect the cost of car insurance that it’s impossible to say which policy is right for any one person.
If you’re thinking about black box insurance because you’re looking to reduce your insurance costs, you may also want to consider third-party only insurance. These policies are generally cheaper than the alternatives, but it’s important to remember that they only cover damage to another person’s property in the event of an accident.