Black boxes Set to Become an Opt-Out System for Car Insurance

Telematics devices, more commonly known as black boxes, could become an opt-out system, rather than an opt-in, within the next ten years according to leading insurance industrialists.

The black boxes are a controversial aspect of car insurance, but one that is becoming more and more common place. These systems are causing people worry because of the way they track driving, leading to fears of breach of privacy.

The system is most popular with young drivers, because of the ability to bring down insurance premiums, which can be extortionately high for young drivers. In the future, these extortionate prices may be directed at people who refuse to have a black box fitted car instead as the industry comes to rely more on the data collected by the telematics system.

Tom Ellis, working for Gocompare, spoke at the British Insurance Broker’s Association seminar said “In 10 years’ time there will still be customers who prefer not to have a telematics device installed, [but] it will be an opt-out situation.”

Policies that include a black box will increase from the 1% of policies now, to 15% within 5 years, according to research from Boston Consulting.

From October next year, the European Union has ruled that all new vehicles will have to have a tracker system known as eCall fitted which can alert the emergency services in the event of a crash. This shows that the technology is progressing in that direction no matter what, so it makes sense that insurers would follow similar lines of technology.

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