What is black box 'telematics' insurance?
Black box insurance, also known as telematics, is a type of car insurance policy that calculates your premium based on the way that you drive.
Our short video explains how black box insurance works.
How does black box 'telematics' insurance work?
Black box insurance works by your car insurer installing a small GPS box in your car which transmits information back to them so they can measure your performance behind the wheel.
Some providers may measure how you drive through a smartphone app instead of installing a black box.
Each insurer will have slightly different metrics for deciding whether or not you're a good driver but most will take into account the following:
- The time you drive
How do black box 'telematics' insurers reward good driving?
Black box insurers can reward you in a number of ways including:
- Returning a portion of your premium at renewal
- Giving you bonus based on low mileage
- Giving you a reward 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 penalties 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.
Who offers black box insurance?
The table below shows how many black box insurers are out there, and how they apply discounts and review your premium.
|Company||Age range||Benefits||When premiums are reviewed|
|Admiral||No age limit||Reduction to premiums||On renewal|
|Autosaint||18-24||Reduction to renewal premium||On renewal|
|Bell||17-98||Reduction to premiums||After first three months|
|By Miles||25 - 76||Capped miles discounts - never pay more than 150 miles a day or 10,000 miles a year||On renewal|
|Carrot (Better Driver)||19-29||Weekly rewards such as vouchers and discounts||The premium is fixed|
|Carrot (New Driver)||17-25||Earn points in exchange for high street vouchers||The premium is fixed|
|Co-op Insurance (Young Driver)||17-75||Reduction to renewal premium (up to 22.5%)||On renewal|
|Coverbox||17-80||Reduction to renewal premium||On renewal|
|Direct Line||17-95||Driver under 26 - reduction to annual premium. Drivers over 26 - reduction to premium and quarterly cashback cheques.||Quarterly|
|Drive Like a Girl||17-25||Reduction to premium||First quarter in first year, then on renewal|
|Hastings Direct Smart Miles||17-31||Reduction to renewal premium||On renewal|
|iKube||17-25||Reduction to renewal premium||On renewal|
|Ingenie||17-25||Premium reductions throughout year and at renewal||Quarterly|
|Insure the Box||No age limit||Bonus miles and premium reductions||On renewal|
|Marmalade||17-24||Reduction to renewal premium||On renewal|
|Privilege||17-95||Reduction to premiums||On renewal|
|Tesco Box Insurance||17-25||Bonus miles and premium reductions||Monthly for bonus miles and annually for premium|
|Wise Driving||No age limit||Reduction to premiums||After first 60 days, then monthly|
Research carried out in February 2018.
How much does black box 'telematics' insurance cost?
Like traditional car insurers, black box insurance companies charge a number of fees. The following factors could affect how much your black box car insurance policy could cost.
Change of vehicle
If you buy a new car and want to continue using your black box, some providers will charge you a fee for the privilege. Drive Like a Girl, for example, charges a £90 fee to transfer the box from your old car to your new one.
Some insurers will also charge you a fee for switching to a new vehicle even if the box is yet to be installed. Wise Driving charges a £35 fee for this change.
When you sign up for a black box policy, your provider will set an installation date for the fitting of the device. If you miss the date, it's likely you'll incur a fee. The Co-operative, for example, charges £45 for a missed installation.
Black box disconnection
If your black box policy comes to an end and you decide you want to move to a different provider, you don’t have to have the box removed from your car, but it will need to be switched off. Most black box providers do not charge for this, but some do, notably Admiral, which has a £100 fee.
If you no longer want a black box policy and don't renew (or you cancel your policy mid-term), most providers will not ask you to have the box removed, instead preferring to disconnect it remotely. However, if you do decide that you want to get rid of the box, you could be charged. Coverbox, for example, charges £60 to remove its black box from your car.
Traditional car insurance fees
As well as the fees listed above, black box insurers charge many of the same fees as traditional car insurers. This includes an APR if you pay monthly, cancellation charges and duplicate document fees.
If you opt for black box car insurance, make sure you read the terms and conditions carefully before you sign up. This will help you avoid any nasty surprises if your circumstances change mid-policy.
Is black box 'telematics' insurance cheaper?
Black box car insurance is not always cheaper than traditional car insurance.
It's best to check both when shopping around – especially if you are struggling to find affordable car insurance.
Make sure you carefully check and understand your policy document - in particular how your policy might reward you for good driving and penalise you for bad habits.
Pros and cons of black box car insurance
On paper black box insurance seems like a much fairer system of calculating car insurance, but it’s not without drawbacks.
Here are some of the pros and cons of black box insurance to consider:
How is the black box installed?
If your black box insurance provider doesn’t offer a smartphone app, you’ll need to get a GPS tracker installed in your car. The tracker is about the size of a pack of cards and is fitted behind the dashboard.
The box is always switched on and should not affect the performance of your car. It is also sealed and tamper-proof so it can't be modified.
There is usually no upfront cost for installation of the GPS tracker, 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 need the device turned off or removed.
What documents are needed for a black box installation?
In order to have a GPS box installed, there are some key pieces of information you'll need to show to the installer. These include:
- 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 bonuses from previous insurers, if this is relevant.
Black box insurance: your questions answered
Is black box insurance only for younger drivers?
When it was first launched in the UK, black box car insurance was mainly aimed at young drivers, as they pay much more than the average motorist for cover.
That is no longer the case and black box car insurance has since opened up to a wider range of people.
It can be particularly useful for older drivers and those who drive infrequently.
If you are not a younger driver and are looking to buy black box car insurance, make sure you get a suitable policy that isn’t limited to a younger age group.
What happens to my data with black box insurance?
In order for black box insurance to work, your insurance company constantly tracks your behaviour behind the wheel to see how you drive.
This has led to some concerns about the security of your data; however, data protection laws mean that your driving data is protected.
Your data may be shared with third parties who work with the insurer, such as claims professionals, and your data may be handed over to the police if they have a court order asking for it (or if you give the police permission or are suspected of fraud).
Will I be on a curfew?
It depends on your policy. Some car insurance providers might specify on your policy that you shouldn't drive between certain hours.
This is normally a time period when serious accidents are most likely to happen (late night or early morning).
This doesn’t mean your car is uninsured during those times but it may affect your driving score.
How can I monitor my own 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.
What if I have another question?
If you have any more questions about black box insurance, get in touch with our experts on the Which? Money Helpline or email us using firstname.lastname@example.org.