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8 minute read Car Sharing Guides Learner Drivers

A Guide to Telematics and Black Box Insurance

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

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 a more realistic amount. We’re here to talk you through the basics of telematics insurance, its benefits and its restrictions.

What is telematics insurance?

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

While telematics policies are mostly used by young people, they are becoming increasingly popular with other demographics, and plenty of companies offer policies 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.

What are the different types of telematics devices?

Black Box

Black box 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 premium, 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 insurance company can use the GPS signal to track your car if it’s been stolen.

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 cars because you can just move your device over to your new car. Don’t forget to tell your insurer that you’ve changed vehicles, though!

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 premium or policy cancellation. It’s probably best to keep autostart on, unless you’re about to use other forms of transport.

Are there any restrictions with black box insurance?


You’re usually asked to give a mileage estimate when you get an insurance quote. Telematics can monitor whether or not you’re keeping within this mileage estimate, and this could affect your premium come renewal. Also, some companies 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 revolving around 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 drive at unsociable hours, your score may be affected.

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.

What are the benefits?

Money money money🤑

Above all, telematics insurance is often considerably cheaper. If you drive well, most companies provide you with either a refund during your policy or a discounted rate when it comes to your renewal date, in addition to the cheaper upfront premium. 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. This gives you the opportunity to make changes to your driving to make you a safer driver who is 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!

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 installed black boxes can be used to track your car if it is stolen. It can also be used to decide who is at fault if you’re in a collision.

Will it affect my score 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. You’ll need to make sure that you only let safe, responsible drivers drive your car. Tell them that their driving is being monitored! Real friends don’t bring down friend’s driving scores.

Want to get some more driving practice in before you get a telematics policy for yourself? Check out our Car Sharing Insurance and borrow a friend or family member’s car from one hour to 30 days, to brush up on your driving skills.  If you’re not quite there yet, you can get Learner Driver Insurance from anywhere between 2 hours to 90 days, then worry about telematics later 😉


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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