New pay-as-you-go car insurance welcomed

Wed, 14 Apr 2010

An expert has welcomed the introduction of a new pay-as-you-go car insurance product that uses a satellite box to monitor drivers.

Insure the Box is aimed primarily at drivers who do not use their vehicle that much and young drivers who often face high premiums, according to the Daily Mail.

Premiums are decided after a GPS tracking box monitors driver behaviour, including cornering, braking and the frequency of rests.

Peter Gerrard, head of insurance at Moneyextra.com, welcomed the transparency of the new product, although he recommended that consumers do their research properly before opting for any new cover.

He added: "One concern from consumers previously has always been around the validity of a claim; for example, if they were to have an accident in a 30 mph zone and were found to be driving at 33 mph, will they still be covered as they were effectively speeding?"

The high cost of car insurance for young drivers has previously led to an increase in the fraudulent practice of 'fronting', where a parent declared themselves to be the main driver on a vehicle even if this is not actually the case.
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