Car Insurance Future: Driver Behaviour, Smartphone Data, Plus AI Pricing

Earlier this year the UK Government passed legislation to completely ban drivers from picking up a mobile phone when driving, finally closing a loophole in the law which allowed drivers to take pictures, scroll through a playlist or play a game while at the wheel.

Mobile phones are a dangerous distraction when driving and in a culture of notifications, can have a real impact on the safety of drivers. So this begs the question as to how insurance providers can react to this and encourage better driving in new road users? Currently telematics technology is widely used to measure new drivers’ driving habits like acceleration, speed, braking and cornering – the better they drive, the more their premium is reduced. 

With the new legislation around mobile phones coming into force in 2021, it is clear insurance companies ought to be measuring more aspects of driving to give novice drivers a better start to their driving journey, explains Crispin Moger, CEO at young driver insurers, Marmalade

Black box policies have long been a way to save money on expensive insurance premiums, with safer driving rewarded through lower renewal costs. By now many insurance companies have adopted the technology, but they could be missing out on assessing an even bigger threat to newly qualified drivers – mobile phones and their use at the wheel.

Research shows casualties from reported accidents where drivers were using a mobile has increased by 52% from 2009 to 2018, with deaths increasing by 187% in the same period. Overall, mobile phone use at the wheel contributes to 3% of all fatalities on UK roads. The ability to measure and discourage this is crucial, especially among young drivers where their habits now will influence how they drive in the future.

Historically, our black box technology has reduced the likelihood of young drivers being involved in an accident by 73%. This stat shows that tech which monitors driving habits does already make a real difference to safety, but it could be assessing more behaviours and saving even more drivers. In response to the need for innovation, some insurance companies in the UK have started to adopt something new, a more innovative way of tracking the driving of their customers while managing to keep young people engaged in safe behaviours at the wheel.

Smartphone app-based telematics is one solution to monitor the dangers that are presented in the driver’s seat. While cornering, braking and speed will always be a consideration in the safety of driving, many insurers are doing a disservice to their customers and other road users if they aren’t looking beyond these metrics. If we as an industry are truly seeking to improve safety on the roads, we must innovate to meet the changing habits of poor driving and the dangers associated.

At Marmalade, we have recently partnered up with the world’s largest smartphone-centric telematics company, Cambridge Mobile Telematics. Using its award-winning Drivewell programme, we have introduced our one-of-a-kind ‘App & Tag’ system to measure the driving habits of newly qualified drivers.


As the name suggests, customers who opt for the policy will receive a physical ‘tag’ and a link to an app designed specifically for Marmalade’s customers. Once paired, the app and tag will interact with one another to monitor driving. The simplicity of the tech means we can now open the door to more drivers interested in telematics to reduce their premium.

The system monitors the following:

  • Acceleration

  • Braking

  • Cornering

  • Speed

  • Phone distraction

  • Crash detection

The app allows drivers to keep a track of every journey, monitor where they might have gone wrong and how to improve. Elements of gamification throughout the app means the driver can build streaks for good journeys, achieve badges and in turn save money.

Inclusivity sits at the core of this technology. For many young people, getting on the road will mean doing so by sharing a parents’ car. Traditionally, a barrier to this would have been the increase in insurance premiums for the owner of the car. But this is no longer an issue, thanks to the combination of a secondary insurance policy for the young driver sharing the car, and the app and tag’s ability to monitor when they’re driving. By offering this barrier-free route into driving someone else’s car, newly qualified drivers can maintain their driving skills and confidence after passing their test and work on moving towards an affordable premium. The product can also be used on any car as it simply needs to be stuck firmly to the inside of the windcreen behind the rear view mirror. This means there are no issues with compatibility, and no need for an engineer to wire in the device. .

Something that sets this technology apart from existing black box policies is its ability to measure phone distraction. With the new legislation set to come into force next year, this feature will only serve to protect new drivers on the roads. The app monitors the phone itself, so as soon as it is interacted with, this is tracked. If the car is in motion and the screen is touched or the phone is moved, drivers will see this reflected in their journey scores, and excessive usage could lead to premiums being impacted.

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Early data from the system and the first users signals real improvement, with phone distraction declining by an average of 26% from the first to the third month of the policy. The app has also influenced improvements for drivers who had been identified as driving at risk on more than one occasion in the first month, recording multiple ‘red journeys’. The app recorded reductions between month one and three in the following for these specific drivers:

  • 37% reduction in those at risk of speeding

  • 12% reduction in hard braking

  • 30% reduction in harsh cornering

  • 38% reduction in phone distraction

Hyundai are working on machine learning and AI-driving analytics, so software will decide on safe speeds for road conditions, not drivers.


The future of telematics technology and its development at the current trajectory will inevitably lead to much safer driving, insurance policies that are fair, representative and have accessibility in mind.

Development of technology that doesn’t rely solely on new or a certain type of vehicle will mean that more drivers will have access to the systems that will help to reduce insurance premiums, using just their smartphones to track journeys. The combination of app & tag technology and ever-improving accuracy of telematics and developing artificial intelligence (AI) means that drivers can be more confident than ever of the accuracy of data, meaning they are fairly represented through their driving. In the longer term, camera technology is likely to be incorporated into devices to help understand the circumstances of an accident more clearly, and to establish who is at fault more reliably, protecting the users of the system.

As we move closer to more personalisation, adaptation and flexibility, personalised premiums which enable young people to pay a fairer price for their insurance based on their own driving style are likely to become more popular. Combining this new app and tag technology will allow the innovation of new products to enable more tailored options to fit around an individual’s circumstances. It is possible that in the future AI could enable automatic movement from product to product based on the customer’s activity and what would be most cost effective for them in the longer term.

Insurance has to adapt to meet the needs of new and young drivers, the incoming legislation is just a small indicator to an acknowledgement of the changing dangers on the road. The industry must now adapt to fit that change and provide all it can to customers. Rooted in that mission should be a vested interest to reduce accident rates, provide a product that adds real value to drivers and adapts with the changing needs of the society and customers we serve.

About alastair walker 12555 Articles
20 years experience as a journalist and magazine editor. I'm your contact for press releases, events, news and commercial opportunities at Insurance-Edge.Net

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