Co-op come up with new smartbox for young drivers

16th March, 2011

The average motor insurance policy will increase by up to 34 per cent to £845 a year. Many young drivers will have to pay in increase of up to 58 per cent to £2,251 and one of the main reasons for the hike in premium costs is apparently due to the rise in injury claims after road traffic accidents.

MP’s have accused insurance companies of selling on details of motorists involved in accidents to car hire companies and repairers; this is an added income stream for them.

Insurers have been accused of selling addresses of those having been involved in crashes to personal injury lawyers, who pay the insurance companies for the information to take rival insurers to court.

The number of claims now outstrips the number of accidents.

When a driver takes out a car insurance policy today almost half of the premium will be used to cover the cost of claims for whiplash, legal fees, tax and fraud.

To help with this problem the Co-operative insurance has launched a “pay as you drive” policyfor 17 to 25 year olds that will calculate the driver’s premiums based on telematics.

A smartbox is fitted to the car with information about the driver’s behaviour being collected via satellite to the box. Behaviour such as breaking speed restrictions would mean that the driver’s premium would increase and those whose behaviour was considered good would see theirs decrease. The young driver would be assessed every 90 days.

 

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