Cheap Car Insurance From Big Brother

"Fit a small device in your car and you could get 30% off your car insurance premium. It's not as if the device is a semtex bomb or anything, so you'd expect people to jump at the chance, surely? And you'd be right.

Norwich Union's Pay As You Drive car insurance product for young people was over-subscribed. If you haven't heard of it yet, the insurer installs a black box no bigger than a DVD case in your car, so that it tracks you with GPS and records when, where and how often you drive. You pay a reduced monthly premium and then you pay for your usage.

The box records other information too, such as how fast you drive. According to moneysupermarket, the technology could even work out how fast you corner.

Norwich Union has now acquired two years of data from the first wave of subscribers, mostly aged 18 to 21. At present no one else can join, but I think it's likely the scheme will be rolled out to all drivers at some stage in the near future. Not only that, but other insurers are going to get in on the act.

This scheme is best for 'good' drivers. It's most competitive for anyone who's willing to do less mileage - perhaps less than 100 miles per day - and if you don't drive after 11pm. You may also be better off if you drive on safer roads.

One alternative to this is to simply get a low-mileage scheme. To find these policies, you just compare car insurance quotes online or walk into your broker and get a quote as normal. The mileage figure you provide will automatically be factored into the quote, so you should get a cheaper premium. You should always get quotes from lots of insurers, as a standard policy from one insurer will often beat specialist schemes like a low mileage one, or even Pay As You Drive.

However, I believe black-box policies are the way of the future. Insurers are constantly searching for more data to improve pricing, and looking for more ways to collate that data. You might not like the idea of big brother-type boxes, but, as more insurers get on board, good drivers may well have to take these schemes in order to get cheap policies. Anyone who doesn't co-operate may find that their premiums become less and less affordable.

Right, I'm off to buy 100 metres of tin foil. That'll keep those spying eyes off me!

Norwich Union's scheme is currently closed to new applicants, but you can still reduce your premiums by comparing car insurance quotes through The Fool.", By Neil Faulkner, Fool.co.uk, September 12, 2006

Yellow cars could keep car insurance down

"Yellow cars could prove a safe option for motorists who want low car insurance after a study found they were the least likely to be broken into.

A survey of 2,500 drivers, carried out by security firm barriersdirect.com, established that the most prevalent colour of cars which had suffered break-ins was blue, accounting for a quarter of responses given.

With only two per cent of votes, yellow cars had been broken into the least.

The second most popular answer was red, with 22 per cent of answers, followed by silver with 13 per cent and white with ten per cent.

Another finding was that 16 per cent of stolen vehicles such as cars and caravans are taken from house driveways or outside owners' homes and a third of those questioned said they became anxious if a strange van, car or lorry parks outside their house.

This information echoes the finding by the British crime survey, which discovered that about 40 per cent of vehicle crimes happen on the street outside the home.

A key point of the crime study was that new cars are at least risk of being stolen as a result of advanced security measures, which could also contribute to lowercar insurance premiums." Kwik Fit Insurance, UK

Can Car Insurance Be Affected By Your Bad Credit History?

"If you have bad credit you can be denied car insurance! The protections afforded to the consumer since the Depression of 1929 no longer exist. The Financial Laws passed through Congress in 1992 allowed banks, insurance companies, investment firms to handle banking, insurance and investment operations. Laws passed after 1929 had prevented banks from insurance and direct stock exchange trading, likewise insurance companies could not pursue banking operations or stock exchange nor could stock exchange companies pursue insurance or banking operations.

This freedom was granted without the subsequent protections of the consumer included in these new laws. There currently exists no single body of consumer law covering the privacy of consumers. The private citizen must fight the triumvirate of bank,insurance and stock exchange through the court system for his own right to privacy.

Some states have allowed the use of individual credit to be a determining factor in the issuance of car insurance. However, two such states, Texas and Michigan have institutionalized state agencies to meticulously govern and manage those insurance bodies. These states have a socialized automobile security plan where individuals having bad credit or low income jobs can obtain economical coverage or liabilitycar insurance.

True, each has rather strict guidelines by which a motorist can qualify for low cost insurance. However, this is a two edged sword! The performance characteristics of every insurance agency and company are meticulously maintained. These involve the speed with which legitimate claims are processed by the insurance company, customer satisfaction (both client and claimant), conformity to state and federal laws. A performance index is issued for each firm and their respective insurance costs are compared with both a state and federal cost per coverage. The state has created its own actuarial data base to evaluate insurance coverage. The motorist can freely view these to determine the best coverage for his situation. The consumer is given power that the insurance vendor can appreciate and respect.

This fact may give some satisfaction to the average motorist but some of us still want to know how good or bad credit make a motorist a good risk or a bad one. Perhaps it is an honesty issue! If I have good credit then I will always obey the rules of the road and none of life's bad things will touch me. Does good credit mean that you can avoid being hit by a drunken driver, avoid having your car pushed off the highway into the nearby lake or have hail storms miss you? I can understand where the honesty of making constant insurance payments would be reflected in your credit but how does it establish insurance rates?

Reviewing the Report to the 79th State of Texas Legislature, 2004 I discovered that insurance was not denied because of a bad credit score but that it could be a higher premium because of poor credit. Statistics showed that people in the 30 year age group has the worst credit and the greatest vehicle damages reported. My conclusion would not be that bad credit makes you careless. Rather my summation is that youth and proneness to erratic behavior was the cause. The point here is that there is no direct causal relationship but at the strongest an inferential connection." by Joseph Kenny, Market-Day.net