A.
The Black Box is an adaptive car insurance scheme designed to reward good driving behaviour with reduced insurance premiums, whilst also penalising for aggressive/bad driving.
The scheme was first launched by the Co-operative Insurance back in March 2011 under the title Pay How You Drive and is mainly targeted at young drivers aged between 17-24 years old.
While the Co-operative only offers this insurance to drivers in the target age bracket above, the AA has no maximum age limit for the service.
The scheme aims to offer these drivers more of a chance to get behind the wheel, at a time when escalating insurance premiums are discouraging many.
It uses a GPS device officially dubbed the Smartbox, which is installed into the user's car, out of sight of any passengers that might be in the vehicle. This is a precaution in case the car is ever stolen, since the Smartbox can track a vehicle's location.
The device takes about 45 minutes to install and the process may or may not be charged for, depending on the insurance provider.
It's also possible to remove the Smartbox from a car if the driver wants, however this can require a removal fee.
The Smartbox monitors how the vehicle is driven by calculating speed, acceleration, braking and cornering.
The purpose of this is to provide an insight to the driver regarding their behaviour behind the wheel. Those with more conservative, notionally 'safer' driving styles will receive a lower insurance premium, as they're perceived to be less of a danger on the roads, therefore less likely to be involved in an accident.
Those with more aggressive styles, or those driving in circumstances more likely to lead to a crash may receive higher car insurance premiums.
For instance, between 11PM and 5AM is the time period Co-Op judges to be the riskiest for young drivers to behind the wheel.
The driver's insurance premium can be reduced by up to 11 per cent compared to the original price if deemed safer, However if the Smartbox registers signs of aggressive and bad driving, such as breaking the speed limit, then the policy holder's insurance premium will increase in cost, potentially by as much as 15 per cent.
A driver can also have their black box insurance cancelled if the Smartbox records a speed which is so far over the legal limit, that a driving ban would be imposed in court.
You should investigate using a Smartbox if you feel your current insurance premium is very high and consider yourself a careful, responsible and conservative driver - or someone who drives in situations less likely to involve accidents.
The scheme's performance after first year
As of June 2012, the Co-Operative Insurance reports that 20,000 drivers have signed up to the Young Driver scheme since its creation.
The company also revealed that over 80 per cent of drivers using the scheme have qualified for a discount thanks to safe driving. The Co-Op's average premium for customers aged between 17 and 22 is currently at £1,345.
In contrast, research from the AA back in April 2012 found the industry average for insurance in this age group was as much as £3,478.
The Black Box insurance scheme has yet to be widely adopted; the AA is the only mainstream insurer besides the Co-Operative which currently offers this service. The installation of Smartbox systems is covered by specialist companies including Coverbox and Insure The Box.