Insurance 'Black Boxes'

Nice to see the insurance companies taking up Cycalogical’s idea of fitting black boxes to vehicles to monitor driving, rather than waiting for their customers to crash before deciding they’re a bad risk.

The Co-operative look like they’re first out of the traps. Their black box seems to contain an accelerometer, a speed monitor and a clock. It monitors acceleration, braking and cornering forces, as well as speed limit compliance and time of day. The data from the box is monitored and used to compute a discount or a penalty. In other words, if you can balance an egg on your dashboard you can look forward to a discount. Break the egg, though, and an additional premium will be yours: up to 15% extra. Think about that for a minute – based on a £3000 young driver premium, 15% is £450 – considerably more than a speeding fine. Additionally, they will “cancel any policyholder’s insurance should they drive so far above the speed limit that a driving ban be imposed by the Courts.”

The product is aimed at young drivers, but there doesn’t seem much reason why it can’t be extended to all drivers in time: after all, most safe drivers wouldn’t say no to lower premiums in exchange for being monitored. There’s only one reason why you would not want your driving monitored (privacy considerations aside), which is that you don’t intend to drive safely within the law – and who would want to insure such a person?

Of course, the black box can only detect aggressive driving. Detecting distracted driving and mobile phone use seems to be beyond its capabilities for the moment. But it’s a start.