Young drivers save £50m thanks to black box car insurance
Young drivers have saved more than £50 million in the last five years thanks to ‘black box’ telematics insurance policies.
Black box insurance policies see the cars of (typically young) drivers fitted with devices that measure the distances, times and manner of the cars being driven.
By agreeing to such policies, drivers tend to be offered significantly reduced insurance premiums, which are calculated on a monthly basis. The most careful (and those who cover the fewest miles) tend to see the cost of their cover reduce over time, while those who speed or drive in a risky manner can see their premiums increase, or even have their policy cancelled.
A new analysis of two billion driver miles by The Floow – a Sheffield-based telematics analysis firm, and technology partner of the Direct Line Group – show drivers opting for a telematics policy have saved £50m over the last five years thanks to the reduced premiums such policies offer.
The Floow claims to use data and social science to help enable “smarter and safer” mobility by collecting telematics data from every second of a journey, such as where and when it takes place and how the driver behaves behind the wheel.
Direct Line Group then uses this data to better understand the risk each of its drivers represents and enables them to provide “fairer and more accurate” premiums to its customers.
As well as cheaper premiums, those opting for telematics policies are also able to benefit from an overview of their driving style as they receive a score for each journey, based on factors such as speed and smoothness.
Under Direct Line and The Floow’s programme, policyholders whose driving generated poor scores were offered a coaching programme to help them improve. According to The Floow, for every 100 graduates from the lowest-scoring groups of drivers, the coaching programme helped them increase their score by around 30 per cent.
Annette Fox, head of telematics at Direct Line Group, said telematics data helps the company “offer better premiums to young drivers” and “educate, inform and improve road safety overall.”
Dr. Sam Chapman added that the data was “making a tangible impact on driver safety, encouraging safer driving, which is preventing accidents.”
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