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Europe's Big Brother Insurers Trialing Black Boxes

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For years, women in Europe have been paying less for car insurance than their male counterparts.

Statistically, the claims that women make on their insurance are significantly less expensive, hence the lower rates. However, December 2012 brings a European ban on assessing rates based on gender, which is set to bring up the cost of insurance for women by 11 percent.

The Globe and Mail reports that the U.K's biggest motor insurer, Royal Bank of Scotland, is testing black box technology that allows them to monitor the driving styles of their customers, from which suitable insurance premiums can be decided.

Insurance companies are worried that the increase in premiums for all women will put many off driving, resulting in lower revenue.

Basing premiums on a case-by-case, individual basis is clearly a fairer way of operating, but there's a worryingly Orwellian side to black box technology that may also put many customers off.

Black boxes would measure all sorts of parameters, such as speed, acceleration, steering, journey length and journey times, using each to form a better picture on how an individual drives.

This sounds a bit grim for driving enthusiasts - while there's no excuse for excessive speed, black boxes still can't take into account a driver's individual ability to assess risk or react to incidents. This could potentially make even the skilled driver's premium higher than that of a driver who might be a constant liability but have been lucky enough to avoid trouble in the past.

Of course, at this stage any such policy would be purely down to the individual's discretion, so any driver not wishing to be monitored would be free to choose their insurance from a different provider.

The British insurance industry hopes the technology will encourage drivers to drive more safely (or more slowly, which isn't always the same thing) in order to benefit from lower premiums.

Britain's two biggest insurers are currently researching the technology, which is now cheaper and easier to install than ever. The results from a trial run by Aviva, the U.K's second largest insurer, were positive - claims dropped by a third, and premiums by just over a quarter.

Similar technology, including "nanny cams", is already available in the U.S, mainly focused on reducing risk for younger drivers.

If the scheme works well in Europe it could become more widespread. While it remains an optional scheme it's clearly a good idea and less discriminatory than gender-based insurance, but it might not be so popular if black boxes became compulsory...
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