How black box car insurance works

Car insurance

How black box car insurance works

By Simon Miller

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How black box car insurance works

Get to grips with the basics of black box insurance, from getting the box installed to what insurers look for in your driving and how this could affect your premiums.

Black box car insurance, also known as telematics, is a type of policy that calculates your premium based on how you drive. A GPS box is installed in your car, and transmits information back to your insurer so it can measure your performance behind the wheel. With some providers, you can use a smartphone app instead. 

How do insurers measure your driving?

Each insurer will have slightly different metrics for deciding whether you're a good or bad driver, but most will take account of the following:

  • braking (sharp braking is frowned upon)
  • cornering (take corners gently)
  • consistent steering (no sudden veering)
  • speed (staying within the limits)
  • time at which you drive (driving at night is considered more dangerous)
  • mileage (drivers with lower mileage usually get lower premiums).

How do insurers reward good driving?

How you are rewarded depends on the type of policy you have. If you have a policy based on discounts, you will either be rewarded with money back monthly, quarterly or as a discount at renewal. Policies that are based on mileage – where there's a limit on how much you drive – often have bonus miles as rewards that are dished out monthly or quarterly.

However, there are also punishments if you drive badly. Some providers could increase your premiums, while others may cancel your cover altogether if you perform poorly or are frequently caught breaking the speed limit.

How do I monitor my driving? 

Black box car insurers send you frequent feedback so you can monitor your driving performance, and will pick out trends that affect how your premium is calculated. This feedback is accessible online. Some providers offer smartphone apps that will also give you access to your driving data.

How is the box installed?

If your provider doesn’t offer a smartphone app, you’ll need to get a GPS tracker installed in your car. The tracker is around the size of a cigarette packet and is fitted behind the dashboard.

The box will not affect the performance of your car, and it's always on. It is sealed and tamper-proof so it can't be modified.

There is usually no upfront cost to have the GPS tracker installed, but charges are likely to apply if you need to transfer the box to another a vehicle, or if you decide you no longer want black box car insurance and you need the device turned off or removed from your car.

Find out more: Black box car insurance fees and charges

What documents do I need to show the installer?

In order to have a GPS box installed, there are some key pieces of information you'll need to show to the installer. These are:

  • your driving licence, or the certificate showing you’ve passed your test if you're awaiting your licence
  • the V5C (logbook) that shows proof of car ownership and ownership history
  • confirmation of the car purchase from your dealership if you’re still waiting for your V5C
  • proof of your no-claims discounts from previous insurers, if this is relevant.