Appetite for telematics insurance is on the rise with UK drivers, who increasingly see such policies as a way to gain reductions on their motor insurance premiums. Research from The Green Insurer finds that the vast majority (81%) of UK car drivers are now aware of telematics insurance.
While just 8% of drivers surveyed currently use telematics devices, 35% of drivers say that they are either quite likely or very likely to consider a telematics policy at their next insurance renewal. This rises significantly to 61% of younger drivers aged 18-24 who will consider a telematics policy in the near future.
Younger drivers routinely face higher motor insurance premiums because of the risks associated with their relative inexperience. This could explain why more than a quarter (26%) of drivers aged 18-24 surveyed claim to already use a telematics device, over three times the average number of drivers surveyed claim to have one.
When asked what would convince them to use a telematics insurance policy, 59% of all drivers said they would want to see substantially lower premiums. This was followed by 29% who would like reassurance that their driving data would be secure.
A fifth (20%) of drivers said they needed proof that a telematics insurance policy would be better for the environment to consider such a policy. However, almost twice as many (39%) younger drivers aged 18-24 say their main motivation would be that it would be proven to be better for the environment.
The majority (85%) of drivers who already have a telematics device fitted report reductions in their annual premiums of up to 20%. Almost three-quarters (70%) have seen reductions of between 5% and 15%. This rises to 80% of drivers aged 18-24 who have reduced their policy costs by between 5% and 15%.
Paul Baxter, CEO, The Green Insurer, said: “It’s interesting to see the direction of travel for telematics insurance as people become more conscious about the impact of driving on the environment.
“And it’s not surprising that younger drivers in particular are drawn to the benefits of telematics insurance. Their relative inexperience means they face the highest premiums, so it’s great to see how many younger drivers are already seeing a link between using telematics insurance and lower policy costs.
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