There are more telematics-based car insurance products on the market than ever before as insurers look to target more drivers with technology-based products. Research from financial information firm Defaqto found that the number of telematics products available on the market has more than doubled in the last three years. Today there are 55 telematics products available compared to just 25 in 2016, with insurers looking to utilise the technology to more customers and not just younger drivers who were initially the focus for such driving monitoring devices because they are considered a high risk.

Another significant change to telematics is that drivers no longer have to have a device fitted in their vehicle. In 2016, all 25 products had a ‘black box’ device fitted to the policyholder’s car which would send data back to the insurer. Today, only 53% of policies (29 out of 55) require a black box to be installed and the others offer motorists a range of telematics options, including a ‘plug and drive’ system where the device is sent to the policyholder to self-install, or an app which can be used to track driving habits.

Mike Powell, insight consultant at Defaqto, said: “Telematics policies have done a lot of good in encouraging young and new drivers to develop good driving habits. Some policies include online dashboards that allow the driver to review their driving and become better drivers. Most black box policies also include theft tracking devices and accident alert systems, which is a great added bonus.

Meanwhile, new data from ITS Telematics Solutions reveals that telematics technology reduces insurance claims on average by 22%. According to the research, a total of over £1.79bn could be saved each year by adopting black box technology. The typical cost of a motor insurance claim has risen to £2,936, the highest level on record, according to figures from the Association of British Insurers (ABI).

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