The Pros and Cons of Black Box Car Insurance

If you’ve been looking for the best value car insurance, you may have come across what’s called black box car insurance or telematics. This type of car insurance calculates how much your premium would be based on your driving behaviour. Black box car insurance utilises technology to know how much driving you do, how you drive, and other useful information insurers can use to calculate the best price for your car insurance premiums. This sounds good and may even help you save money, but what are the pros and cons of black box car insurance policies? 

What is black box car insurance? 

Telematics or black box car insurance uses specific devices that you could stick onto your windscreen, trackers that you could plug into the dashboard of your vehicle or more complex GPS devices that need to be professionally installed. Some insurance policies don’t require a separate device since your phone can also be used to access the mileometer of the car. For every insurer offering black box car insurance policies, specific metrics are needed to assess your driving behaviour. Some of the common factors they take into account are the following:

  • Mileage
  • Speed
  • Steering
  • Braking
  • Cornering
  • And the time you usually drive

Can young drivers get black box car insurance?

Definitely! As a matter of fact, black box car insurance policies were actually tailored for young drivers with little driving experience. Drivers who are under 25 years old usually have to pay more for their car insurance premiums compared to older drivers. The reason behind this was that young drivers make insurance claims more frequently, statistically speaking, and their claims are also more costly than other age groups.

Of course, not all drivers under 25 drive poorly. If you think you’re a good driver and you make sure you take all precautions whenever you’re on the road, then you might benefit from getting black box car insurance and enjoy a fairer price even if you’re a young driver.  

Is it a good idea to get black box car insurance?

Yes. Black box car insurance has plenty of advantages. If you make it a point to drive as best as you can, you can enjoy rewards from your car insurance provider. With black box car insurance, you may be offered discounts on your premium if you maintain a good track record of driving safely. Other rewards include retail vouchers you can use when shopping in favourite stores and money back off your car insurance premium. If you have a policy that has a mileage limit, you may get bonus miles every month or every quarter as a reward for good driving. 

Apart from rewards and bonuses, having a black box car insurance policy allows you to review your own driving behaviour, and you can use this to improve the way you drive. In the event of theft, the black box device can be used in tracing the car. The device can also provide evidence in case you need it when you have a claims dispute and need to support your claim.  

How does black box insurance work for bad drivers? 

If you’re a good driver, getting a black box car insurance policy would definitely be beneficial. But what if you’re not a very good driver? How would the black box car insurance work? Depending on your policy and the insurer, you might get penalties if you’ve been driving badly. The insurance company could raise your current premiums or even cancel the insurance cover altogether if they see how poorly you drive and if you’ve been caught driving beyond the speed limit frequently.   

Pros of Black Box Car Insurance

  • Lower premiums for good drivers
  • Fair prices for young drivers who drive safely
  • Ability to locate stolen cars 
  • Data can be used to improve driving

Cons of Black Box Car Insurance

  • Higher premiums for people who drive poorly
  • Extra fees when changing vehicles
  • Additional charges if black box installation is missed
  • Removal of the black box will also require some fees

Should I get a black box car insurance policy?

The answer to this question depends on how safe you are as a driver. If you think you do a pretty good job following speed limits and driving carefully every time you’re on the road, then a black box car insurance policy can be advantageous to you, especially if you’re a young driver. Be aware, though, that this type of car insurance may not always be cheaper than the usual car insurance policies available. And depending on your driving behaviour, the insurer may charge you a higher premium if they think you’re a high-risk driver. If you want this particular type of car insurance, you can shop around first so you can compare offers from different car insurance providers and find the most suitable policy for you. 

Final Thoughts

Owning a car can be costly. After buying the car you want, you have to be ready for the cost of insurance policies, taxes, repairs and maintenance, and other expenses. Getting car insurance can really be pricey. That’s why it’s important to consider this when you’re still shopping for a car. The type of car you buy determines the price of your car insurance premium. Try to find cars that are cheaper to insure, such as those with low-horsepower engines. High-performing vehicles look great and feel amazing to drive, but they can be very expensive to insure. 

You can also consider buying a secondhand car. It’s generally much cheaper to buy and insure. You can even finance it, so the cost of the car is spread through a series of affordable monthly payments. If you want to have an idea of how much you need to set aside per month, try our car finance calculator for free!  👍