Over half (57%) of all drivers expect to switch to a telematics-based car insurance policy by 2017 according to research from Gocompare.com

NEWPORT, Wales, April 19, 2012 /PRNewswire/ --

Fifty-seven per cent of drivers believe they will switch to a telematics or "black box" insurance policy in the next five years, according to a new study* from Gocompare.com.

The study into the relationship between driving habits and insurance found that a wide cross-section of motorists are open to the idea of telematics-based car insurance. In fact, 59 per cent of over 55s said they may switch to one of these policies in the next five years and 19 per cent of all drivers were happy to consider it at their next renewal.

However, the research also identified the issues which have held back the sector until now, including low levels of awareness, the lack of big name insurers and evidence of real savings in terms of premiums and fuel costs.

The survey highlighted the strong underlying support for car insurance premiums based primarily on the way you drive, not on age and gender, with careful drivers rewarded with cheaper premiums:

• 92 per cent of drivers think that their car insurance premiums should be based largely on the way they drive;
• 97 per cent think careful drivers should be rewarded with cheaper insurance;
• 60 per cent think that car insurance premiums should be based on where they drive and the time of day;
• Only 49 per cent think premiums should be based largely on age and gender.

Scott Kelly, head of car insurance at Gocompare.com commented, "Over the last few years we've seen car insurance premiums reach record highs. The outlook for 2012 is little better with further increases expected, as well as a degree of uncertainty for young drivers once the European Court of Justice gender ruling takes effect; insurers will no-longer be able to take gender into account when calculating premiums.

"Most insurers currently price their policies based on a series of generalisations around claims experience, location, age, sex and the type of car. Most don't consider an individual's actual driving habits until they have built up a record of safe, claim-free or incident-free driving over a number of years and have subsequently earned a no-claims discount. According to insurance companies, young drivers - particularly males - are most likely to make claims and therefore face the highest premiums. The average shop around premium for a driver aged between 17 and 22 is £2,497**, nearly treble the average price. While this group has potentially the most to gain from "black box" car insurance, with an average saving of £521 achieved with insurethebox telematics insurance***, the concept appears to have broad appeal."  

Gocompare.com's research also outlined the steps the industry still needs to take to make "black box" car insurance policies more attractive to consumers:

• 75 per cent of drivers would expect cheaper car insurance premiums
• 54 per cent would like regular incentives in terms of discounts and special deals
• 43 per cent think more awareness of the benefits of behaviour-based policies would be beneficial
• 40 per cent would like savings on fuel by driving better or less
• 35 per cent want to see big insurance brands offering behaviour-based policies
• 33 per cent would like to be able to access data on their driving behaviour via a PC-based dashboard
• 29 per cent would appreciate advice on how to improve their driving based on their own data

Scott Kelly concluded, "Given the rising costs of motoring, we think that the new generation of telematics car insurance policies will play a greater role in the car insurance market in the coming months. And, as our survey shows, many drivers, across all age groups, would happily embrace the new in-car technology in a bid to keep their premiums down."

Telematics technology operates via a small black box, roughly the size of a mobile phone, which is fitted to your car and measures driving behaviours such as time of travel, distance, types of roads used, speed, levels of acceleration and braking and accidents. The insurer uses this information to generate a risk profile for your driving and charge a premium accordingly. Policyholders also benefit from access to an online portal where they can monitor their driving behaviour, which may help them assess ways to better improve their skills or reduce their mileage, and a tracking facility should the car be stolen.

Gocompare.com currently offers car insurance quotes from insurethebox and coverbox.

http://www.gocompare.com/car-insurance/telematics-car-insurance/

* Research commissioned by Gocompare.com. On 7^th to 8^th February, 2012 Vision Critical conducted an online survey among 2,008 British drivers with their own car insurance policy who are Springboard UK panellists.

**According to the AA's benchmark British Insurance Premium Index dated 19^th January 2012

***Customers saved an average £521 on their car insurance with insurethebox (based on a survey of 850 customers between 15/11/2010 to 17/08/2011)

Notes to editors:

Research commissioned by Gocompare.com. On 7^th to 8^th February, 2012 Vision Critical conducted an online survey among 2,008 British drivers with their own car insurance policy who are Springboard UK panellists.

*AA British Insurance Premium Index January 2012 - The average shop around premium for a young driver (17-22) is £2,497. The average shop around price for all drivers is £971.40.

Gocompare.com launched in November 2006. It was founded by Hayley Parsons, who has worked her entire career in the insurance broking and aggregator markets, and was the first comparison site to focus on displaying product features rather than just listing prices. It was this philosophy that led to Gocompare.com becoming the first price comparison site to be invited to join the British Insurance Brokers Association (BIBA) in May 2008 and helped force older comparison sites to change their 'quick quote' ways and stop using assumptions to calculate estimated figures.

Today, Gocompare.com provides one of the most comprehensive online car insurance comparison services in the UK as well as comparing home, motorbike, van, pet insurance and breakdown cover.

Gocompare.com is authorised and regulated by the Financial Services Authority.

SOURCE Gocompare.com