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white clock learner driver8 minute read Car Sharing Guides Learner Drivers

A guide to telematics and black box insurance

One of the biggest costs for newly-passed drivers is insurance. Telematics insurance is designed to keep that cost down. But what’s it all about?

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by Eilidh

The cost of insurance can be sky high just after you’ve passed your test. Lots of young drivers are now opting for telematics or black box insurance to bring the cost down to something a little more affordable. We’re here to talk you through the basics of black box and telematics insurance, its benefits and its restrictions. 

What’s the difference between telematics and black box insurance? 

Telematics insurance is an umbrella term (which basically means it covers all types) for personalised car insurance based on your driving style. You’re probably more likely to have heard of black box car insurance because it’s the most popular kind of telematics insurance for young drivers.  

What is telematics insurance? 

Young drivers are often considered high risks for insurance cover, meaning that their costs are higher. Black boxes allow insurers to calculate your risk by considering your driving habits. It’s usually a lot cheaper than regular insurance for young drivers, as the price of your insurance reflects how you drive, not just the year you were born. 

While telematics insurance policies are mostly used by young people, they’re becoming increasingly popular with other age groups, and plenty of companies offer telematics insurance for anyone. 

The insurance requires you to have a device in your car that monitors the way that you drive. This device uses GPS, and can record speed, your steering, braking, mileage and journey time/length. Different insurers will use this information in different ways to assess your risk. 

Black box car insurance 

Black box insurance policies are what most people think of when they think of telematics insurance. They’re small devices fitted into your car’s dashboard (out of sight). You won’t have to pay for the box as the price will be included in your payment for the insurance, but you may have to pay a fee if you change cars. An engineer will have to fit your box, but you’re covered before the box is fitted, so you don’t have to wait around before you get on the road! 

A great thing about installed black boxes is that your insurer can use the GPS signal to track your car if it’s been stolen. 

What do telematics boxes record?  

The data collected may vary depending on who you choose to insure with, but generally black boxes record:  

  • How fast you drive on different types of road 
  • How sharply you brake or accelerate
  • Handling on corners
  • How often you take breaks on long journeys
  • Your total mileage and your motorway miles
  • Location your car is parked 
  • The time of day you drive
  • The number of journeys you make 
  • G-force (so it will be able to tell from the impact if you’ve had an accident)

Black box insurance rules 

Mileage 

Depending on the insurance, there may be rules around how many miles you can drive. You’re usually asked to give a mileage estimate when you get an insurance quote. Telematics can monitor if you’re keeping within this mileage estimate, and this could affect your price come renewal. Also, some insurers actually charge Pay As You Drive rates, and you may be charged if you go over your mileage allowance. 

Time of day 

A common myth about telematics insurance is that you have to stop driving at around 10pm. While this is generally false, the time of your journeys will be taken into account in your driving score. If you’re a bit of a night owl and drive late at night, your score may be affected. Some black box insurance policies do have a curfew, so just make sure you check with your insurer.  

Monitoring your driving 

You’re going to have to make sure that you’re driving to a decent standard if you opt for telematics. You also need to make sure, if you have the app, that you’re monitoring your journeys. 

Black box car insurance pros and cons 

Pros of black box insurance 

Money money money 

Above all, black box insurance is often considerably cheaper. If you drive well, most companies will give you either a refund during your insurance policy or a discounted rate when it comes to your renewal date, as well as the cheaper upfront price. Some even give rewards in the form of vouchers and prizes.  

Becoming a safer driver 

Having telematics insurance encourages you to develop a safe driving style. It gives you a better insight into your driving habits and how you can improve, which makes you less likely to have an accident. Having telematics or black box insurance also takes away that temptation to speed – meaning that you’re less likely to be caught out with a fine or on a speed awareness course.  

Potentially life-saving 

Some telematics devices send out an alert to emergency services if they detect that you have had a serious-impact crash. So, they could save your life, as well as your money! 

Accidents & theft 

The GPS signal in black boxes can be used to track your car if it’s stolen. It can also be used to decide who’s at fault if you’re in an accident. Here’s what to do if you’re ever involved in a car accident.  

Cons of black box insurance 

Privacy  

This could be seen as a pro or a con, depending on your perspective. Arguably it makes you safer, but some people just aren’t comfortable with this amount of data being collected on their driving. 

Curfews 

One of the biggest complaints when it comes to black box insurance! Some insurers may penalise you for driving late at night because the roads are generally higher risk at night.  

What are the other types of telematics devices? 

Plug-in devices 

Plug-in devices are similar to the installed black boxes but, instead of an engineer fitting them into your dashboard, you just plug them into your OBD socket, 12V adapter or USB port. Unlike the traditional black boxes, you won’t have to pay a fee if you change vehicle because you can just move your device over to your new vehicle. Just don’t forget to tell your insurer that you’ve changed vehicles. 

Telematics apps 

Some insurers measure your driving via an app that you have to download on to your smart phone. The app will use your phone’s GPS in a similar way to the black box. Lots of these apps start automatically when it senses that you’re driving. Beware though, sometimes they get confused and end up monitoring train/bus journeys. Some apps have the option to turn off autostart, so remember to turn it off if you’re going on public transport or in someone else’s vehicle. 

If you forget to monitor your journeys, you may be in breach of insurance conditions. This could result in an additional costs or insurance cancellation. It’s probably best to keep autostart on, unless you’re about to use other forms of transport. 

Will it affect my black box insurance if someone else drives my car? 

If a named driver or someone who is insured using temporary car insurance regularly uses your car, their driving could affect your driving score. We don’t want to sound like killjoys, but you’re best off not letting any risk takers drive your car. Safe, responsible drivers only – there’s money to be saved!  

Car insurance without a black box 

If you’re not quite sure you’re ready to commit to black box insurance, you could use temporary car insurance without a black box to get more experience. With our temporary insurance you can borrow a friend or family member’s car from 1hr to 30 days, to brush up on your driving skills.  

If you haven’t passed your test yet, you can get learner driver insurance from anywhere between 2hrs to 90 days, then worry about telematics later. 

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Eilidh

Hi I'm Eilidh 👋 I joined Veygo for a 3 month internship in June 2018 and loved it so much I decided to stay! I've been driving for 4 years and, despite being an awful singer, I am known to belt out performances of my fave songs in my car 👩‍🎤

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