Black box to cut car insurance costs

THE Co-operative Insurance is giving drivers under the age of 25 the chance to cut the cost of their car insurance, by fitting a black box to their car.

Co-op hopes that by installing the technology, which tracks driving habits, young drivers will act more responsibly.

The black box system, which is installed in the car at no cost to the driver, uses a GPS system to calculate where, when and how far the vehicle is used sub-divided into three times periods: off-peak, peak and super-peak. Premiums are then calculated on the driver’s actual risk on a pay as you go basis.

Manchester-based Co-op Insurance says that by managing the way they use the car, drivers could can pay as little as 1p a mile for comprehensive cover.

The average cost of insurance for drivers under 25 now stands at £1,463 and young drivers saw an 11.5% increase in their insurance premiums, compared with an inflation rate of 3.1% in 2008, according to industry figures.

David Neave, director of general insurance at The Co-operative Insurance, said: “We are taking a big step towards tackling the problem of the uninsurable generation on our roads by providing real incentives to reduce the cost of motor insurance.

“As long as young drivers are properly educated about the risks of the road and drive responsibly there is no reason why they should be priced out of the market.”

The initiative is part of Co-op Insurance’s 2 Young 2 Die campaign in association with Brake, the national road safety charity.

Young drivers can qualify for reduced insurance premiums through the 2 Young 2 Die website by answering a series of questions on the dangers of reckless driving. Once they have passed the online test, users can apply for Co-op motor insurance.