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If you’re thinking of buying or leasing a car in the UK over the next few years there is a strong chance it will be fitted with a telematics system. That’s the view of a leading expert who believes that the UK is set to follow Italy’s lead and make telematics boxes compulsory in all new cars.
Ofir Eyal has worked in insurance for more than ten years and specialises in risk management and motor insurance strategy. He recently told delegates at the Insurance Telematics Europe conference in London that the UK government was looking at the merits of ‘Monti’s Law’, legislation that makes telematics sytems compulsory in new cars.
But what are telematics boxes? And how do they work? Keep reading to find out.
A telematics box is a small device that is fitted out of sight in your car, whether you own the car or you have used a car lease agreement or a personal contract hire plan. The box records information about your driving using motion sensors and GPS and sends this back to your car insurer.
Your insurer can then look at how you drive including how often you exceed the speed limit and whether you are regularly braking and accelerating hard.
Many car insurers use the technology to help you reduce the cost of your car loaninsurance. They do this by using the data to help you drive in a safer, more positive way – and by rewarding good driving with cheaper premiums.
In 2012, Italy introduced legislation sponsored by the former Italian Prime Minister Mario Monti which made telematics boxes compulsory in new cars. Some experts believe the UK is set to follow suit to help tackle the problem of fraudulent insurance claims.
However, roads safety minister Stephen Hammond played down any suggestion of imminent mandatory legislation. He said: “The department continues to work with the insurance industry on the roll out of telematics products, which offer the potential to reward safe driver behavior and penalize financially those who do not drive safely.
“It is up to insurers and drivers whether they use these products but we have no plans to make them compulsory.”
Fleet News reports that ‘a BCG study suggests that by 2020 more than 15 per cent of all [insurance] policies in key European countries will be using telematics.’
Frederic Bruneteau, managing director of Ptolemus Consulting Group, said:
Most insurers use static or statistical criteria such as age or location to evaluate a driver’s risk. Insurance telematics takes into account this criteria, but gives four new parameters – distance, time, place and driving behavior. It is the fastest growing segment of the insurance industry.
Many insurers in the UK already use telematics systems, predominantly aimed at younger drivers who now have greater access to new cars through cheap car leasing and finance deals.These insurance companies are developing more sophisticated insurance products while new car manufacturers are also beginning to embrace the technology.
Fleet News reports that Citroën has fitted its C1 Connexion special edition with a telematics box to reduce the cost to younger buyers of insuring a new car. The Smartnav system allows Citroën to offer free insurance for the first year of ownership to all eligible drivers from 19-75 years of age when the car is purchased using one of their car leasing plans.
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Sherwood Garage provides people in search of Used Cars for Sale Glasgow with the best selection they can choose from. For years now, Sherwood Garage have delivered the exceptional service of delivering admirable types of cars to our clients’ garages.