Motorists that have installed a ‘black box’ device, used to monitor their Driving Behaviour, for reducing their insurance premiums, may be at risk of having the data used against them if given to the police. As a result, the ‘black box’ will work against them and instead of reducing their premiums it could increase them upon renewal as driving habits are recorded. This is especially significant as the industry works towards standardising data to share between firms.
New cars are commonly fitted with tracking devices allowing insurers to easily price policies based on motorists’ real driving tendencies. Driving well earns discounts, whilst the opposite will see premiums soar. Although, concerns are increasing that telematics technology, is progressing quicker than the law protecting the motorists it monitors. Policyholders’ records have been forwarded to the authorities to assist in investigations and the question persists over who is the real owner of the data.
These devices may be recording millions of cases where the law is being broke by policyholders. Research has shown ten million motorists are continuously breaking the 30mph limit and if caught would have to pay a fine along with penalty points on their license and huge increases in their insurance premiums. Drivers are also regularly underestimating their speed, especially young drivers, evidenced by only one in five admitting to breaking the 30mph barrier when actually 46% were actually breaking the limit in the 30mph zone.
Insurance companies like Direct Line and The Co-operative Insurance have passed telematics information to the authorities due to a court order being produced. Though, this has only been the case for severe criminal investigations, as opposed to minor road offenses. In Italy, data on motorists is shared between companies, especially following an accident, which allows claims and premiums to be sorted more accurately. At the moment, this is not possible in the UK, as firms use different systems, but with standardisation high on the insurance industry’s agenda motorists’ data will be shared easily.
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