What does a black box do? Devices, driving score and savings

How does black box insurance work?

Black box insurance, otherwise known as telematics insurance, works by gathering your driving data and sending it to your insurance provider.

Your insurer then analyses this data to work out your level of risk. If you’re a safe, low-risk driver, you should be rewarded with cheaper car insurance.

Your data is usually gathered by either installing a small GPS-enabled device in your car or by using an app on your phone to monitor your location and movement.

This measures things like where and when you drive, how sharply you accelerate and brake, and how smoothly you take corners. Your insurer will use all factors it considers relevant to calculate your driving score.

Black box insurance policies base insurance premiums on actual driving behaviour. For this reason: 

1. If you’re a driver in a high-risk group, they can be a great way to prove to your insurer that you can drive safely, reducing the cost of insurance.
2. If you’re a young driver, they could help you get good-value car insurance, even if this is the first insurance policy you’ve taken out.
3. Telematics car insurance could be an option if you've just passed your test and are looking for the cheapest car insurance for new drivers.

What types of black box insurance are there?

When it comes to the black box itself, there are 3 main methods insurers use to collect your data.

Professionally fitted black box

The original telematics car insurance policy involves an engineer installing a small device in your car to monitor driving behaviour.

The box is about the size of a mobile phone and usually installed out of sight behind the car’s dashboard. This black box automatically records your driving without you having to remember to switch it on.

It’s the most reliable way of collecting driving data, which is why it’s the most common method for stricter black box policies.

Here’s what happens if you decide to opt for this kind of black box policy:

1. Your insurance company will arrange for the black box to be installed in your car, usually at your home.
2. Your policy begins from your chosen start date, so you won’t need to wait for the box to be installed to drive legally.
3. You won’t have to pay any extra for installation, as the price of the box is factored into your premium. But you may have to pay a fee if you change cars during the policy and want to have the box installed in the new car.

Most installed black boxes can also act as a tracker and can make it easier to retrieve your car if it's stolen. Some installed black boxes also offer accident alerts which tell the emergency services your location if they detect you’ve experienced a serious impact.

Self-install plug-in device

Self-installed black box policies also gather your driving data, although you install the device yourself. These black boxes - also known as plug-in or plug-and-drive devices - are usually provided by your insurer.

This method is often used for short-term or temporary car insurance. Here’s how it works:

1. Self-install devices are simple to use. Just plug it into your car’s USB port, OBD socket or 12V adapter.
2. Once you’ve installed the device, activation is instant.
3. The price of the box is usually included in your premium, and you won’t have to pay to install the box if you change cars. Simply unplug it and install it in your new car.

Just remember to inform your insurer if you change your vehicle, or you might invalidate your cover.

Smartphone app and tag system

Some insurers track your driving behaviour by using an app installed on your mobile phone.

You don’t need to have a device installed by your insurance company - simply follow your insurer’s instructions to download the app to your smartphone. This is the method which involves the least amount of hassle to install.

With certain policies, you may need to attach a small self-adhesive tag to the windscreen, which pairs with the app. This helps the insurer to identify that you’re in the right car, rather than a passenger in someone else’s.

Here’s how it works:

1. Black box telematics apps use the built-in GPS on your mobile and some more advanced versions use your phone’s accelerometer to detect speed and any impacts.
2. While some apps black box apps have an auto-start feature that detects when you’re driving and starts monitoring, some require you to start the app before your journey.
3. Always make sure your phone is charged and in the car before you make a journey.

You don’t need to do anything with the app while you’re driving, meaning you shouldn’t be distracted behind the wheel.

Will a black box policy give me a curfew?

When black box technology first came into use, most telematics insurance policies were curfew-based. This meant drivers could have their premiums increased if they used their car after a certain time of night.

None of the black box policies available via Uswitch are curfew-based. In fact, most modern policies don’t impose a strict curfew, meaning you’re free to drive at any time.

But it’s worth noting that night-time driving (for example 11pm-4am) is statistically riskier. This means it will negatively affect your driving score with some policies, which could impact your renewal price.

If you regularly need to drive at night - for example if you work night shifts - it’s important to check the policy wording to make sure you’re not penalised by this.

Will a black box policy give me a mileage limit?

With some policies, such as pay as you go black box policies, there may be a mileage limit. While this might sound restrictive, there are a couple of things to bear in mind:

• All car insurance policies ask you to provide an estimated annual mileage
• Any mileage limit will be a ‘soft limit’, in that you’ll still be insured even if you exceed it

The main advantage of these policies is that they’re great for low mileage drivers. People in higher-risk groups, like young or elderly drivers, often pay high premiums even if they don’t use their car much. A low-mileage policy adjusts the price to reflect how little you actually drive.

When you take out the policy, you may need to agree to your estimated annual mileage. If you drive more than this:

• You might have to pay for extra miles (“top-up” bundle)
• Your renewal price could be higher

Driving over the agreed mileage usually doesn’t cancel your insurance, but it can make it more expensive.

Does a black box make insurance cheaper for young drivers?

For many, including young drivers, black box insurance offers a cheaper alternative to a traditional car insurance policy. It has the potential to bring down the cost of cover, especially if you’re a safe driver who falls into a high-risk group.

This is because it lets you avoid being grouped with other drivers of the same age or experience, who are often considered higher risk. Instead, your insurance price can be based on how you actually drive.

It’s important to remember that you still need to show you’re a careful driver according to your insurer. The app may highlight areas where your driving could improve. If your insurer gives recommendations, following them can help lower your insurance costs.

How is a black box fitted?

This depends on the type of black box policy you’ve chosen:

• Professionally fitted black boxes will usually require an engineer to come and install it in your car. Your insurer will arrange for your black box to be installed by a professional fitter at a safe location, usually within 14-28 days of the start of your policy - although you’ll be covered as soon as your policy begins.
• Self-install plug-in devices will usually be posted to you. You then install this yourself by plugging it into your car’s USB port, OBD socket or 12V adapter.
• Smartphone-based policies will simply require an app to be installed.
• App and tag systems usually involve receiving a self-adhesive tag (sometimes called a beacon) in the post. You then pop this on your windscreen and pair it with your smartphone app.

Where is a black box fitted?

With traditional black boxes that require an engineer to install them, the exact location depends on the type of device and your car. Installation usually takes less than an hour and the device is fitted in a discreet, secure spot, typically in or near the dashboard.

You may need to provide some or all of the following documents before installation:

• Driving licence, or DSA pass certificate if you’ve just passed and your licence is still being processed
• V5C registration certificate
• Proof of no-claims bonus (if applicable)

Common installation locations include:

• Behind the dashboard
• Under the bonnet (often near the car battery)
• Within the vehicle's bodywork

In all cases, they shouldn’t be visible to the driver or passengers. And they cannot be easily tampered with.

Do I have to pay for installation?

No. The cost of the box and installation is included in the price of your premium. But if you want to change your car during the policy, you may have to pay for installation of a new box and transfer your insurance to your new car.

How do black box insurers reward good driving

Insurers measure and reward good driving behaviour in different ways. Many telematics boxes track acceleration, braking, cornering and journey time. Insurers then take these factors into account when working out the cost of your annual premium.

With most policies you can monitor your driving behaviour online, or via the app. Some insurers will offer rewards and discounts for drivers that demonstrate safe behaviour on the roads.

Rewards aren’t necessarily related to the cost of your premium - some insurers may offer partner rewards, such as money-off vouchers with certain brands. Others might offer cashback.

Drivers using their cars outside of peak traffic hours could also save, as some insurers charge less for miles driven when the roads are emptier and accidents less likely.

It’s important to bear in mind that, while safe driving is rewarded, unsafe driving will have the opposite effect. If you prove yourself to be a dangerous driver, you even risk invalidating your policy.

Things to be aware of with black box insurance

Black box insurance relies on telematics to monitor how and when you drive, so it’s important to follow the policy rules:

• Never tamper with or disable the black box, as this could invalidate your cover
• Keep your estimated mileage accurate and update it if your driving habits change, as exceeding the agreed limit could increase costs
• Drive safely and follow the rules of the road
• Only named drivers on your policy should drive the car, as allowing others to drive could invalidate your cover

Don't forget that the car you drive also affects insurance costs. Find out the cheapest and best cars for new drivers.