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Can telematics make your car insurance cheaper?

Whether or not you go on to switch to a telematics policy, will send you a free in-car cradle and charger once you've done 20 miles (until 31 October) and give you £25 cash back after driving 250 miles (also until 31 October).

With those rewards on offer, the data collected from the app must be of value to, but the company assured us that it would not be sharing the data with any third parties and that it is trialling the app to help customers understand telematics products better.

Jo Garci, head of telematics at, told TechRadar that the app records the following driving data: GPS co-ordinates and signal strength and time; the trip's date and time; your acceleration; your deceleration; your G-rating, which effectively measures your cornering; and your phone model, software version and application version "for support purposes".

The future of telematics

We asked Garci how telematics boxes might develop in the future and what additional info they might use in calculating an insurance premium, such as how long someone has been driving without a break, or whether their stereo is being played at a high volume.

"From a technology perspective this is all possible as with many other features - are customers using their phone when driving? how many passengers are in the car?" Garci replied. "However, personally I think customers will have a huge concern on the 'Big Brother' factor and the consequence of their actions.

"Customers currently struggle with the potential annual increase in motor insurance premiums and if there was also a risk of this increasing because of their driver behaviour mid-term this is likely to make them even more reluctant to give permissions to insurers to monitor these elements."

Per-mile road tax

Aside from calculating insurance rates, telematics could also be used to change how road tax is applied to a model where drivers pay per mile.

"As we know, the Government is looking to make changes to the road tax model currently due to falling revenue levels using the CO2 emissions method," explains Garci. "The introduction of E-Call may also help if they wanted to go down this path." E-Call is a European initiative that should be in place by 2015. The technology behind E-Call enables a crashed vehicle to automatically alert the nearest emergency centre with its location, thus lowering response times.

But this, too, is unlikely to be unpopular, warns Garci. "Ultimately, whatever method the Government chooses is likely to amount to an increase in tax that consumers need to pay which just adds further pressure on motorists."

We asked whether telematics boxes might one day become compulsory, and used to automatically debit fines from the accounts of speeding motorists, but again, Garci warned "I personally think this would be a very unpopular proposal for the Government to introduce and is likely to have quite a public backlash."

So it's unlikely that telematics boxes will become compulsory but perhaps they don't need to be to increase adoption.

Instead, imagine a situation where anyone who chooses not to have a telematics box fitted is automatically put in the highest risk insurance group and pays top rate. Fit the box, and your premium comes down. Doesn't a telematics policy sound more attractive now?