“Black boxes” are being installed in cars in Northern Ireland which may result in car insurance premiums being reduced by as much as 55% for younger drivers. It is a small device with new “telematic” technology.
According to the AA, since 2010, drivers under age 22 have seen premiums increase by just about 40% and for those aged under 29 by 37%.
The AA revealed that male drivers between the ages of 17 to 20, on average, are paying a huge £3,515 per annum just to insure a small vehicle.
A twelve-month pilot scheme has recently been completed by a family run insurance broker in Northern Ireland called Kerr Group Insurance utilising this “black box” equipment with existing clients. As a result of the successful findings, towards the beginning of this month, they have started to provide lower premiums.
The firms Managing Director, Roland Kerr commented, “The price of car insurance is a hot topic, particularly for the 17-25 age group where insurance premiums have risen by more than 46%. Although the specific reasons for this increase vary, the single largest reported factor is the high frequency of road accidents involving young people.”
Some of the factors that affect car insurance premiums are experience and age that help insurance companies assess the level of risk.
With telematic technology the driving behaviour, such as acceleration, braking and speed of the individual motorist can be monitored
Roland Kerr added, “Every case is different, but a typical young driver could save between 35-55% on a standard insurance premium.
We believe this solution will offer a more attainable level of premium for safe drivers and enable more young drivers to afford to keep a car on the road.”
The “black box” is forecast to help stop what is known as ‘fronting’ which is illegal. This happens when the likes of a parent takes out insurance on a car in their name but the car is mainly to be driven by their son or daughter. This action can result in the policy being invalidated and no claims honoured. This technology allows the broker to more reliably assess who is the primary driver of the car.
The AA stated that less than 10% of cars are presently fitted with a “black box” but, over the next ten years, this is expected to increase to 50%.
The Office of Fair Trading recently discovered that in Northern Ireland car insurance premiums were about 11% more than elsewhere in the UK.