LONDON, UNITED KINGDOM--(Marketwire - Aug. 31, 2012) - Know Your Money - a leading financial comparison and advice website - has registered a 70% month-on-month increase in traffic for telematics car insurance policies.
With telematics car insurance - sometimes known as 'black box' insurance - a device is installed into a customer's car which monitors the way that they drive. Those that drive safely are rewarded with cheaper policies.
Know Your Money's increases in search numbers for the product have been sustained at steady rate of growth between March and August 2012, with 70% representing the average monthly increase during that period.
In response, Know Your Money has polled the insurance companies that offer telematics car insurance in the UK and can reveal that more than 210,000 policies have been sold to date. Though the first UK telematics products were tested in the market as early as 2006, more than half of the total policies have been taken out over the last year, since mid-2011.
The number of companies that offer the product has also grown considerably. Though the providers are generally specialist companies, the market is now a third bigger than at the beginning of this year and more of the traditional insurers are beginning to offer telematics. In addition, the growth is expected to continue to rise dramatically over the next five years. So much so, that the product could account for more than half of all car insurance policies by 2017, according to some companies' estimates.
Supporters of telematics car insurance say that the product answers two problems. As well as lower premiums, especially for young people, it is predicted that the development will lead to much safer roads, since drivers will be more careful in order to get the cheapest prices.
With this in mind, Know Your Money joint founder Jason Tassie said he was pleased to witness the upwards trends.
He commented: "The growth in interest for telematics insurance products has been explosive so far this year. It's something that we're delighted to see here at Know Your Money.
"Rising car insurance policies have priced many young people out of the market in recent years and it is unfair to punish the majority because of the actions of the few. Telematics car insurance policies have been proven to reduce car insurance costs significantly for young people and the early evidence suggests that road safety will improve too. We therefore see telematics as very much a product that is in line with our values as a consumer champion in the finance market."
Rassam Fakour-Zaker, editor at Know Your Money, added:
"Black box insurance products have been developing over the last few years but up until now take up has been slow. However, as well as the increase in traffic to our website we've had lots of requests from our audience for the latest products and tips on how to buy telematics insurance. It looks like 2012 will go down in history as the year that black box cover takes its place as a mainstream insurance product."
How it works
To get cheaper rates on their car insurance, telematics policy holders must drive to a number of standards. Their average speed, how much they drive and where, their breaking habits and how fast they go round corners will all be transmitted back to the insurer by the device. The company will then analyse the data to decide how much the customer pays.
To help customers improve their driving, telematics insurers will also present each customer with an analysis of their own performance. This information is made available via the Internet or is sent via text messages, allowing the customer to make interventions where necessary. Systematic price reviews are then carried out at monthly or quarterly intervals for each customer.
The policy also comes with the added bonus that if the car is stolen the telematics device will be able to pinpoint where it is.
A round-up of other statistics on telematics car insurance:
- 1500% - the growth in the telematics market since 2009 (British Insurance Brokers' Association)
- 57% - The number of drivers that expect to switch to telematics car insurance by 2017 (research commissioned by GoCompare)
- 20% - The amount that road accidents could be reduced by through telematics insurance (Norwich Union - now Aviva)
- £821 - The amount that the average first time car insurance customer saved with a leading provider (insurethebox customer survey)
- 92% - The number of drivers who back prices to be decided by the way that they drive (research commissioned by GoCompare)
- 26% - The number of drivers that are involved in a collision within two years of passing their test (AA/Populus survey)
As well as covering a wide range of banking and insurance products within its comparison tables, Know Your Money serves its audience with a portfolio of straight talking guides, industry updates and offers for high street shops and restaurants.
The Know Your Money Telematics Car Insurance Guide is available by clicking here:
The Know Your Money review for the car insurance comparison site, Go Compare is available here:
At Know Your Money our remit is to help our users make informed decisions when purchasing or applying for financial products.
Through our product comparison tables and straight-talking guides, we help people to find suitable and affordable products that will stand them in good stead for the unknown financial demands of the future. The range of products we cover accounts for all major banking, insurance and utilities products.
Since launching in 2005, Know Your Money has grown to over 300,000 unique visitors every month, with more than 50,000 opted-in recipients of our weekly e-newsletter.