How does a black box work?

A telematics device - sometimes called a black box - is a small unit installed in your vehicle, usually behind the dashboard or under the bonnet. Some insurers use a smartphone app instead of a physical device to collect the same data.

The device monitors your driving and transmits data to your insurer. This data is then used to build a picture of how safely you drive. Some policies adjust your premium in real time based on the data received; others use it at renewal to determine whether your premium should go up or down.

Telematics devices typically record the following:

• Speed - whether you are driving within posted limits.

• Braking - how sharply or frequently you brake.

• Acceleration - smooth acceleration is considered lower risk than harsh acceleration.

• Cornering - how smoothly you navigate bends and junctions.

• Time of day - driving during high-risk periods, such as late at night, may be scored differently.

• Mileage - some policies charge per mile based on telematics data.

Your overall driving score is calculated from a combination of these factors. Consistently safe scores can lead to premium reductions; poor scores may lead to increases or, in some cases, policy cancellation.

Telematics policies are most commonly taken out by:

• Young or new drivers who face high standard premiums and want a way to demonstrate safe driving.

• Drivers returning to the road after a break, who may struggle to get competitive standard quotes.

• Low-mileage drivers who could benefit from a pay-per-mile structure.

Learner drivers may also benefit from telematics policies, particularly while building up hours behind the wheel. See our guide on learning to drive and getting your full licence for more on the options available to new drivers.

Telematics may not suit drivers who regularly cover long distances, drive at night, or who prefer not to have their driving monitored.