Faulty black boxes raise drivers’ premiums

where insurers have told customers they were driving badly when their cars were standing still, or speeding when they were under the limit. One accused a motorist of driving over the English Channel to France when his car was stationary on a ferry.

Telematics cover involves insurers tracking driving habits through a device fitted to the car or a mobile phone app. Good drivers are given a higher driving score and rewarded with lower premiums, while poor driving results in paying more.

The premise of telematics is that motorists accept the invasiveness of being monitored because black boxes are so accurate that they can detect and reward good driving.

But this is now looking increasingly shaky. A decision from the Financial Ombudsman Service last month found that a telematics box fitted by RSA, an insurer, had indicated that a driver, Mr L, was worse than he actually was.

On at least two occasions the box had merged separate journeys into one, harming Mr L’s driving score. RSA updated the box’s software, but the problems continued.

The insurer then replaced the box, but the new device was even worse. On several occasions RSA told Mr L he was speeding, or that he was not driving safely, again harming his driving score. However, Mr L had a dashcam fitted, which proved he was under the speed limit and driving smoothly on each occasion.

The ombudsman ruled that the data recorded by the boxes was inaccurate and caused Mr L “financial penalties” through the loss of reductions in the premium at renewal a year after he took out the policy.

It found that Mr L had suffered “serious errors” from RSA and ordered the insurer to pay him £500 in compensation and money towards a new policy with another insurer.

An RSA spokesman said: “We’re always disappointed when a customer isn’t satisfied with their experience with us, as was the case for Mr L.

“Telematics and black box technology provides important data for both motorists and insurers. It has played a critical role in promoting safe driving and making insurance more affordable and accessible for young and new drivers.”

The ombudsman also said Mr L should not have had to spend so much time and effort getting evidence to prove the boxes were not working properly. Its ruling said: “He paid RSA the premium he was asked to pay. And in exchange he had every right to expect the equipment to function properly and for accurate data to be produced.”

Because of the effort involved in discovering and proving that the boxes are wrong, many drivers with inaccurate telematics devices will not realise or will not be able to fight their corner against an insurer.

Mike Fotis of Smart Money People, a consumer review website, said: “It is hard to prove when the data is wrong. You need to have a lot of nous and a lot of determination, and most people roll over and say ‘ the data says it so it must be true’.”

Telematics insurance is becoming more common; the ombudsman estimates that there are more than a million policies in Britain.

It is the most complained-about financial service on Smart Money People and accounts for more than a fifth of all one and two-star reviews on the website. Inaccurate data is