Published: May 27, 2015 | UK
A newly commissioned report by British insurance Brokers’ Association (BIBA) shows a nine per cent increase in the number of live ‘black box’ telematics motor insurance policies.
These types of policies can offer savings of up to 25% for careful drivers. In particular, young drivers who often struggle to find affordable cover, can save up to £1,000.
BIBA surveyed the leading telematics insurance providers in the UK to determine the number of live policies currently in use in the market. The results showed an increase of nine per cent compared to the same time last year. There are just under 323,000 live policies compared to 296,000 in December 2013.
Chris McKee, CEO of BIBA member Ingenie, said
“Our data shows a 40% reduction in crash risk for new young drivers with a telematics policy, compared to the national average. Removing IPT would help spread this benefit to more young drivers by encouraging greater take-up.”
The technology uses hard-wired ‘black boxes’ in the vehicle to monitor a number of different factors such as speed, cornering, acceleration, braking and familiarity of route. These are calculated to give a risk profile – with the safest drivers enjoying the biggest discount.
The increase in sales comes as BIBA’s Manifesto calls on the new Government to consider insurance premium tax (IPT) relief for telematics policies for young drivers in a bid to reduce accidents and make driving more affordable. The Department for Transport is conducting research to demonstrate the value of behaviour based policies and have now completed the first stage, the feasibility study.
BIBA member research shows that one in eight new drivers with a telematics box crash in their first six months on the road compared to one in five nationally (without a blackbox). Young drivers are over-represented in road fatalities. They make up just 12% of licence holders, yet account for 25% of road deaths.