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How does black box car insurance work?

How does black box car insurance work?

Black box insurance could help you become a safer driver, which in turn, could help lower your premium.  
 
If you’re a high-risk driver, black box insurance might be a more suitable alternative to traditional car insurance.  
 
What, then, is a black box and how does it work? 

Daniel Hutson
From the Motor team
3
minute read
posted 11 FEBRUARY 2020

What is black box insurance?

Black box insurance is a type of car insurance policy that uses ‘telematics’ – monitoring - technology to keep track of the way you drive.  

Data is collected by a telematics ‘box’ device installed in your car and sent to your insurance provider. They use this information to calculate your insurance premium, based on how safely you drive. 

What is the black box?

The actual black box is a small GPS device, about the size of a mobile phone, installed out of sight behind the dashboard of your car.  
 
As well as the black box, there are two other types of telematics devices available: 

  • Plug and drive – a simple device that plugs into your car’s 12-volt adapter, much like an in-car smartphone charger.  
  • Smartphone app – some insurance providers offer an app which can be downloaded to your smartphone without the need to install a device.   

The type of telematics used depends on which policy you choose. If it’s a black box, an engineer approved by your insurance provider will need to install it.   

Most insurance providers will want the black box fitted within a specified time, from the start of the policy - usually at a time and place that’s most convenient for you. That might be at home, university or your workplace.

Who is black box insurance suitable for?

Black box insurance is typically aimed at young drivers. The idea is to encourage safe driving, which could also help the young driver get more affordable car insurance.  
 
However, telematics could also provide the same benefits to other motorists who may be classed as high risk, including elderly drivers or drivers with convictions

How does black box insurance work?

Once activated, your black box will collect information on how you drive and send it to your insurance provider. This will usually include information on: 

  • braking 
  • steering 
  • cornering 
  • speed 
  • mileage 
  • journey length 
  • the time of day 

You’ll also be able to see the information via an online dashboard or app. In most cases, you’ll also get feedback, advice and tips based on your driving habits.  

What are the benefits of black box insurance?

Used correctly, black box insurance can offer a number of benefits, including: 

  • A discount on your premium, for safe driving 
  • Helping encourage you to be a safer driver 
  • GPS technology that can be used by emergency services to find your car, if there’s an accident or if it’s stolen 
  • Data collected by the black box can be used to process a claim and possibly establish who was at fault in an incident – which could mean a quicker and smoother claims process for you. 

Are there any disadvantages to black box insurance?

There could be some drawbacks, depending on your policy. For example: 

  • some insurance providers may charge for installation, cancellation or black box removal  
  • some black box policies have restrictions like mileage limits and curfews  
  • you could be penalised for bad driving, which could result in a higher premium 
  • some insurance providers only offer a discount on renewal, so you may have to wait for a year until you benefit from your safe driving style  

Always read the terms and conditions of your black box policy carefully, to understand exactly what limitations and restrictions there are.  

Is black box insurance cheaper than traditional car insurance?

Black box insurance won’t necessarily be cheaper than traditional car insurance. That’s why it’s a good idea to shop around and compare a range of quotes.  
 
If you’re looking for affordable black box or traditional car insurance, compare with us to see if you can find a cheaper deal.

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