How a Little Black Box Can Save You Money on Car Insurance
What Are Telematics?
Telematics is not a word that most people are familiar with, and, yet, it can affect your wallet. Basically, it is sending computer data over long distances. Why is this important? It is used in cars to report your driving data to insurance companies. It sounds like something only tech companies would be concerned with. In reality, it could help you save money on car insurance with a little black box.
Determining Auto Insurance Rates
Currently, insurance companies determine rates based on statistical data. For example, younger, elderly, and male drivers pay more because they have higher rates of tickets and accidents. Of course, this strategy is based on generalizations and, thus, is not very fair. It punishes or rewards individuals for the groups they belong to rather than for their personal value. Of course, there are rewards programs in place to incentivize good drivers, taking into account their personal driving record. But, what if your driving record and style were the only things the company considered? Hypothetically, if you are a man or someone in another high-risk driving category, you can save a lot of money.
Using the Little Black Box
So, how would this work? Insurance companies have devices that are called “black boxes”. These are placed into a car and used to collect data related to driving style. They record things such as speed, miles driven, and the time you are on the road. It will also monitor behavior on braking and the way you navigate corners. All of this information tells them what kind of driver you are and if you could make any improvement to be safer on the road.
Effect on Your Auto Insurance Rates
Due to the way in which the data is collected and assessed, policies based on a black box will have monthly insurance premiums. They will fluctuate based on your driving performance during the previous month. Of course, this is a risk. Once you have committed to this monitoring, you have to deal with the consequences. This can place a certain amount of pressure on you as a driver, making mistakes costly. Make sure to consider your driving record and confidence in your driving ability before securing black box insurance. If you feel comfortable with the process, it can be a very effective way to save money by being rewarded for safe driving.
‘Tis the season! That doesn’t just apply to the holidays, but also to health insurance. You have probably heard the phrase “open enrollment” tossed around either on the news or…Read More
We are all guilty of procrastinating every now and then. Especially when it comes to the somewhat morbid topic of life insurance. We all know that our death is an…Read More
For decades, smoking has been advertised as cool, sexy, and trendy. With the invention of the e-cigarette, tobacco companies did not stray from their tried and true marketing strategy. Plus,…Read More
Among many of the world’s new inventions, e-cigarettes have become a new craze. A recent article from Reuters reported that roughly 1 in 20 Americans are currently vaping or using…Read More
We are all trying to save more money, but sometimes there don’t seem to be any areas to cut back. One avenue to explore is ways to save on car…Read More
We have all heard the horror stories about people not buying specific insurance coverage and then losing their homes to a tragedy. After an earthquake in California, our neighborhood chat…Read More
Mind the Gap There are several situations in life that cause people to either change their health insurance, end their health insurance, or have a gap in coverage. I recently…Read More