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Telematic insurance rewards safer drivers
A recent report on young drivers shows a quarter had crashed within two years of gaining their licence. It's not surprising then that young or even newly qualified drivers face high insurance premiums.
'Pay how you drive' insurance now allows new drivers to prove themselves to be responsible drivers, and so reduce the cost of their cover against the typical premium rating for their age and experience.
The insurer installs a small telematic GPS device in your vehicle. It is sometimes called a 'black box', and is about the size of a packet of playing cards. The device measures how safely the vehicle is being driven in terms of speed, the type of road, time of driving, and braking and cornering. It then transmits the data via satellite to your computer and your insurer.
The GPS device has additional benefits. It can provide the location of your vehicle to a break-down service, raise an alarm if the car is involved in an accident, or track the vehicle if it is stolen. This is particularly good news for parents of young drivers, who not only know the driving behaviour of their children is being tracked, but also the vehicle itself.
AA Drivesafe telematics speedo
Your driving behaviour is analysed on your personal online telematics account, and advice is given on how to improve your score. Regular emails remind you to check your account.
By driving more safely your score will go up, which could earn a premium reduction. Of course, if your car is not driven safely, the score will go down and your premium could go up.
Because they are more likely to make expensive insurance claims, young men have paid higher premiums than young women. But from 21 December 2012 insurers can no longer take account of the gender of the driver when calculating their motor insurance premium. So young women especially may have to pay more for their insurance after this date.
Women using telematic 'pay how you drive' insurance will be less affected by the gender ruling, as there is greater emphasis on how they drive, regardless of whether they are male or female.
'Pay how you drive' insurance is available from the AA. You get a discount on your premium when you buy the policy, and you can earn extra Drivesafe discounts throughout the year for driving safely.
AA Drivesafe – 'pay how you drive'