Telematics Insurance or Black Box Policy | Car Insurance Policy

Drivers around the world are looking for ways to cut down on auto insurance prices but because of the old traditional factors considered by insurers to calculate insurance quotes there is limited scope as to what a driver can do. (Read about the factors that affect your car insurance quotes).

Telematics Insurance or Black Box Auto Insurance policy takes into consideration these old factors but at the same time uses modern technology to accurately calculate the risk associated with each individual driver. This benefits a responsible driver in a great way as he is not punished for factors beyond his control viz. age, gender, place of residence etc.

What is Telematics and how it works?

Under telematics or black-box car policy, your auto insurer installs an app on your smart mobile or will install a device under the dashboard of your car to record your driving pattern. This devise uses satellite telemetry to read your driving habits and then transmits it to insurer’s database. Typically a telematics device contains a SIM card, GPS, accelerometer and proprietary software of insurer which analyses the data and sends the report back.
Wondering what all is recorded by telemetric blackbox? Parameters that a black box records are customized by each insurer as per their discretion but some of the common things they measure are:
  1. How many miles you log in on an average,
  2. At what time you drive,
  3. Roads you usually ply on,
  4. Traffic conditions when you are on road,
  5. How often you brake and how hard you apply brakes,
  6. Your average speed,
  7. Do you follow speed limits and
  8. Number of breaks you take while on long journey.
All this data is analysed by your insurer to calculate your car insurance risk. Beyond the obvious this device also helps to locate a stolen car or to identify if car has met with an accident.

Read More about benefits of UBI or usage based insurance

Finally it can be said that if you are a safe driver then telematics policy will reward you and will help you get the cheapest possible auto quote.

Next read pros and cons of telematics insurance.

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