Black box car insurance

What is black box car insurance?

Black box car insurance is an optional add-on to a standard car insurance policy that can reduce the cost of your insurance premium, provided you can demonstrate that you are a safe driver. Your insurance provider will install a piece of telematics equipment – known as a black box – in your car that will monitor your driving habits and set your premiums accordingly. Black box car insurance may be a good option for those deemed a high risk to insure by providers as it can reduce your insurance premiums if you drive safely and sensibly.

There are three types of telematics available:

• Black box – the most commonly fitted telematic equipment used by insurers. A black box is fitted to your car that tracks your driving through GPS technology.
• Plug-and-drive – this uses the same technology but rather than having a black box fitted to your car, you will be sent a device that plugs in to your car’s charging port or cigarette lighter.
• Smartphone app – a few insurance providers will offer an app you can install on your smartphone that works in the same way as the black box to track your driving through GPS technology.

Who is black box insurance for?

Anyone who is deemed a high risk to insure can benefit from having a black box insurance policy; this may include less frequent drivers with a low annual mileage, older drivers who want to prove that they are safe behind the wheel, or drivers with motoring convictions. 

You can still go opt for a black box insurance policy even if you are a more experienced driver. However it’s likely to have a much smaller impact on the price of your insurance, and may not reduce it at all.

How does black box insurance work?

Once you have chosen a black box car insurance policy, your insurer should send an approved mechanic to fit the device to your car. It’s only small so it won’t get in the way. The device then uses GPS to enable your insurer to remotely collect information on your driving habits, including:

• Mileage – the more you drive, the more likely you are to be involved in an accident.
• Speed – if you are driving over the speed limits then you will be deemed more of an insurance risk.
• Time – if you drive at busier times of the day then you are statistically more likely to have an accident, and therefore more of an insurance risk.
• Location – by tracking where you drive insurers can see whether you use busy roads or country lanes.
• Steering and braking – insurance companies meaure the force of your steering and breaking to assess how safely you are driving.

Often insurance providers will allow you to see your driving statistics online, through a website or an application, allowing you to see which areas of your driving need to improve to reduce the cost of your premium. Only you and your insurance provider will be able to see the collected data, and they will not share it with the police unless it has been requested as part of a criminal investigation.

How much does black box insurance cost?

Black box car insurance is largely based on how well and when you drive, meaning safe drivers can expect to see their insurance premiums reduce with a black box, but some drivers may actually see their premium increase. A black box will be most beneficial for an inexperienced but safe driver as it will reduce their usually high premiums. 

Although many insurance companies provide black box insurance at no extra cost, some will charge for additional services such as:

• Installation fees – to have the device fitted to your car by a professional.
• Removal fees – to have the device removed from your car if and when you change policy.
• Transfers/reinstallation fees – if you need to change the car you want monitored.
• Repair/replacement fees – if you damage the black box then you will have to pay to get it repaired or replaced.