The Smartbox: the sneaky gadget that could save you money

A new `black-box' tracker could see premiums for careful young motorists driven down by as much as £300. But is this really a `revolution' for the car insurance sector?

The cars may vary, but their haircuts, shell-suits and stupidity are almost always consistent.

Yes, the very British-breed of the boy-racer is now a common sight on the high streets and car parks of towns and cities across the country. But as numbers of these fast-driving, slow-thinking motorists have risen, so have road accidents involving young people.

So much so that an 18 year old driver is now more than three times as likely to be involved in a crash as a 48 year old. As well as the obvious human impact, these large numbers of accidents have also pushed up car insurance premiums for young drivers to near unaffordable levels.

This means that even if you’re a safe and sensible new driver – you’ll still be tarred with the boy-racer brush on account of your age.

But this could be about to change...

Smartbox

Co-operative Insurance has just launched a new young driver insurance product which utilises a black-box style tracker that is installed in your car and allows premiums to be calculated depending on the safety of your driving.

The ‘Smartbox’ measures levels of breaking and acceleration, cornering, speed and the time of driving and transmits the information back to the Co-op. Your premiums are assessed every 90 days and responsible drivers are rewarded with a Safe Driving Discount – which can be up to 11% of the annual premium.

Those who have been driving consistently badly however could see their premiums rise by as much as 15% of the initial policy price.

E-mail alerts are also sent out every 45 days to let the driver know how they are performing. Safe motorists will be encouraged to stay on the straight and narrow in order to claim their discount and dodgy drivers will be urged to change their ways if they want to keep their premium.

Online dashboard

The policy also allows the young driver to log into an online ‘Driving Dashboard’ (see the above picture) and view their motoring safety stats. Speed, acceleration, cornering and driving times are all shown on safety speed dials and day-to-day graphs.

Driving advice is also provided alongside the figures to help young motorists improve on their weaknesses and lower their premiums.

While speed does factor into what premium you are given, breaking the speed limit on the odd occasion won’t drive up your premium. 11pm to 6am have also been identified by the insurer as the most dangerous time to be on the road, but again – if you only drive at night occasionally, your premiums shouldn’t be affected.

The Co-op will also operate a ‘card’ system, whereby if you drive consistently over the speed limit you will be shown a ‘yellow card’, warning you to clean up your act. Anyone driving at a speed so far above the legal limit that a ban would be imposed by the courts will be shown a ‘red card’ and have their policy cancelled.

Price points

This new Smartbox scheme is available to drivers under the age of 25 and costs no more than the Co-op’s standard young driver insurance. The initial premium you’d receive is set in the standard way using information about you and your car and the Smartbox is fitted free of charge in an out-of-sight, discreet location on your vehicle. From here, the amount you pay will depend on how safely your drive.

After running the details of a few fictional young motorists through the Co-op’s quote system, it becomes clear that the initial premiums available on this scheme are still not cheap. But then again, even a young driver with a Smartbox fitted to their car poses a higher than average risk to an insurer.

Motorists will also have to shell out if they want the box removed from their car or transferred to a new vehicle.

Smart enough?

I have no doubt that this new scheme is an extremely positive and timely development for the car insurance sector; especially when you consider the recent European Court judgement banning insurers from considering gender when setting premiums.

By introducing the prospect of near-instant rewards for safe driving as well as penalties for unsafe behaviour, young people will be given an increased motivation to drive sensibly. Online feedback will also allow new motorists to start objectively reviewing and discussing their driving habits in an attempt to improve on certain aspects and lower premiums.

Indeed on paper, the scheme sounds great. But, despite the Co-op trumpeting the Smartbox as a ‘revolution in car insurance’, the concept is not actually a new one. We reported on the technology last year in Allow you car insurer to spy on you and save £££ and one of the key problems we identified with it was the ‘big-brother’ stigma attached to black-box trackers.

It’s a problem the Co-op have also latched onto and are keen to dispel by reassuring customers that Smartbox data will never be shared with third parties or used as evidence to avoid paying out on a claim.

In fact, in the CCTV, GPS-ridden age that we all live in, I’m not convinced that many people – especially the young – are actually that bothered about a company being able to track their every move. The real problem I believe this product has is far more obvious – price.

I applaud the Co-op for offering cheaper insurance to safe drivers and sincerely hope other providers follow suit. But with rates for young motorists still so high, I fear that a possible discount of 11% is just not enough to spark the ‘revolution’ in the sector that they are aiming for.

Every revolution has its cost; only time will tell if this one’s is low enough.

What do you think?

Is this really a revolution in car insurance? Would you be comfortable having a smartbox tracker installed in your car?

Let us know your thoughts in the comment box below.

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