Millions of drivers say they will consider signing up for "black box" insurance when they next renewal date. Is this type of cover set to go mainstream?
Telematics insurance, also known as "black box" insurance, uses an in-car recorder to assess how each customer drives.
Insurers analyse the resulting data on distance travelled, speed, braking and cornering.
Then premiums are set according to how much and how sensibly each policyholder drives.
Drive well & save money
Until now, telematics insurance has largely been aimed at younger drivers.
This is because young drivers, those aged 17-25, tend to face high car insurance costs, so this age group stands to gain the most from proving they are careful behind the wheel.
But new research from analyst Consumer Intelligence suggests that telematics could become much more mainstream.
Could black box insurance become the norm?
Its study shows that one in five motorists would consider a telematics deal at their next renewal.
Some 15 per cent of those questioned said they thought this type of cover would soon become the norm.
Ian Hughes, boss of Consumer Intelligence, says that although telematics only represents 4 per cent of all policies currently in force, it is clear that the market is changing.
Hughes adds: "There is of course a difference between considering and actually buying, and the numbers who have black box insurance policies remain relatively low.
"However the launch of new products for the market and increasing acceptance of the benefits of black box policies will mean the sector should grow."
80% aware of black box insurance
Consumer Intelligence also found that there was widespread awareness of telematics policies, with 80 per cent of drivers having heard of the technology.
More than half said they would be interested in telematics if they received a refund on their premiums if they ended up driving less than their expected annual mileage.
Sarah Harris is head of telematics at Admiral insurance.
She says these policies were originally aimed at younger drivers because their higher premiums helped to subsidise the cost of providing and fitting the black boxes.
"But now it is gradually growing to cover other types of driver," she says.
Who is black box insurance aimed at?
"Broadly speaking, telematics is likely to appeal to motorists who have higher than average premiums.
"So if your premiums are above £500 at the moment it is probably worth looking. You have nothing to lose by doing so."
Harris adds that the main appeal of telematics is that it offers responsible drivers the chance to get substantial discounts on the cost of cover.
"Savings of 10 to 20 per cent aren't unusual, and they can be up to 30 per cent in some cases. Otherwise your premiums are based on assumptions made about you by insurers.
"There is also the chance to get feedback about how you drive.
"And other benefits include being able to defend yourself better in the event of a crash, which could help you protect your no-claims bonus," Harris adds.
Car insurance: Are smartphones the future?
Advances in technology mean that take-up of telematics policies could accelerate, Harris says.
This is due to GPS-based smartphone apps such as MotorMate by Confused.com and Admiral's forthcoming AppyDriver replacing the black box.
She explains: "These use mobile phones to record driving data.
"You get a snapshot of similar information to telematics through the mobile phone, and then get a discount upfront from your insurer if this shows you to be a sensible driver."
At present, Harris adds, the apps are not as accurate as a black box, so the potential discount is not yet as big.
But if mobile-phone telematics takes off, it could take over the whole market. I think it's just a question of people getting used to the idea."
Compare black box insurance - you could find a great deal in minutes Get a black box insurance quote