Norwich Union and Trafficmaster sign deal for black boxes

Norwich Union has announced it has signed a contract with Trafficmaster plc, the leading supplier of digital traffic information and intelligent in-vehicle services, for the provision of a further 35,000 telematics "black boxes".

This extends the contract that Norwich Union signed last year with Trafficmaster to provide additional boxes for its Telematics Programme. The "boxes" are at the heart of Norwich Union’s "Pay As You Drive"TM insurance programme and record the time, distance and location of a vehicle’s journeys.

Norwich Union, the UK’s largest general insurer, is conducting a pilot to investigate motorists’ preference for a usage-based motor insurance product. The ongoing "Pay As You Drive"TM and Fleet Telematics pilots launched in 2004 and 2005 have proved extremely successful, enabling Norwich Union to better understand vehicle usage and driving behaviour – providing a uniquely accurate risk assessment tool.

Simon Machell, chief executive, Norwich Union Insurance, said, "This represents the next measured step of our Telematics Programme. By increasing the number of boxes in our pilot, we will have access to additional data to help ensure that any future "Pay As You Drive"TM insurance propositions are best suited to British motorists.

"Our learnings from our pilot are ongoing and substantial, and will shape any future "Pay As You Drive"TM insurance products by putting road safety and value at their heart."

As a result of the pilot, Norwich Union has gathered more than 42 million miles of data - the equivalent of driving around the Earth’s circumference 1,680 times. The pilot to date has recorded over 10 million journeys from its 5,000 pilot customers, with an average of 8,500 miles driven per customer.

This average figure, based on one year’s worth of driving, is well below the national average of 11,000 miles per year. This could indicate that many motorists might benefit from a usage-based insurance product. The black box may also be helping motorists to rely less on their car, opting instead to walk or cycle for short journeys to school, shops or work.

Stuart Berman, Director of Trafficmaster Technologies, commented: "This is a ground breaking initiative and we are, of course, delighted to further develop our relationship with Norwich Union. Trafficmaster leads the way in in-vehicle telematics hardware and innovative services like Smartnav and Trackstar. The introduction of usage based services will further enhance the attractiveness of our vehicle platform."

RAC Auto Windscreens In-Car Services division will fit the black boxes. Mark Hughes, RAC Operations Director, commented: "We are delighted that RAC Auto Windscreens has been able to provide a logistical and technical solution to this project. RAC Auto Windscreens has established a dedicated and experienced team of in-car installation engineers to provide this service to the automotive industry."

"We are proud to be associated with this pioneering project. It is essential that we continue to address the changing needs of the consumer and this new insurance system delivers what they want."