Car insurance UK: Prices could fall as insurers say telematics could change the industry


Car insurance UK: Prices could fall as insurers say telematics could change the industry

The new technology would be able to accurately determine a driver’s road risk and change their plan based on real-world factors. Many young motorists have cut their car insurance bill by adding telematics black boxes to their vehicles which can track how a car is driven, at what times and average speeds. 

The technology has helped younger and inexperienced motorists axe their average costs and save money. 

Tech company Floow is working with insurance companies across the world to develop more advanced tools which could see insurance prices dramatically tumble. 

The technology could soon be able to identify how much of a risk a particular driver is to an insurance provider and vary premiums in real-time depending on this.

It could mean motorists who drive shorter distances and live in rural locations could see cheaper prices than those who regularly use their vehicles. 

READ MORE: Car Insurance prices have dramatically fallen

A recent study by the company found a staggering 96 percent of insurance chiefs predicted significant changes to the motoring industry across the next decade. 

Over half of those surveyed claimed telematics built into cars would be used by most drivers in just five years. 

Aldo Monteforte, CEO and Founder rot the Floow said: “Insurance leaders are correct to predict that telematics will be a game-changer in the field of insurance. 

“We are entering the age where we can precisely quantify the risk if every driver, redefine insurance, and help them become safer on the roads.” 

He added: “On a wider scale, the technology is there to encourage us to drive better and make our roads safer, benefiting everyone.” 

The majority of insurance chiefs added its premiums would soon be based on actual driver behaviour as 34 percent admitted telematics would become the new benchmark for the automotive industry. 

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Their new research revealed 31 percent of insurance chiefs predicted customers would soon be given an overall score for their driving which would directly affect car insurance premiums. 

The overall score could factor in real-world data showing driving speed, time on the road and driving style to determine a price. 

According to Floow, new technology could incorporate an app-based reward scheme that encourages and rewards better driving. 

The technology could even educate motorists on how small changes to their driving style could reduce costs and make them safer road users. 

Floow insurers will benefit from fewer accident claims and greater customer loyalty if motorists are made aware of why prices may have gone up or down based on their driving. 

Speaking to Express.co.uk, Sam said: “From undertaking how a vehicle moves a better understanding of risk related to the technology on the vehicle can be formed. 

“Already it is possible to adjust risk based upon where a vehicle drives to ensure fair pricing for the level of risk preventing the technology can deliver. This makes insurance fairer for everyone.”

Almost a quarter of car insurance chiefs said there could even be a move to family car insurance policies that cover a range of needs in the future to help those on tight budgets. 

Autonomous vehicles were also stated as one of the biggest risks to the car insurance industry as a massive 55 percent of those surveyed believed the technology would have required providers to rethink. 

The survey highlighted shay a quarter of car insurance providers believe autonomous cars being used for business use could be a reality in just five years. 

Electric cars were highlighted as another potential technology upgrade to consider as almost 40 percent revealed these could be the reality for motorists in half a decade. 

Floow confirmed the technology company us developing further telematics technology which will soon be incorporated into insurance policies with mainstream providers. 

Car insurance premiums fell in the third quarter of 2019 as MoneySuperMarket claimed averages for comprehensive cover fell to £459 from a previous figure of £483. 

Car insurance premiums were also below £480 for the third consecutive financial quarter for the first time since 2015 in a massive win for customers. 

However, car insurance premiums remain high for certain age demographics with young motorists paying upwards of £1000 per year for cover. 


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