In order to do this they offer various deals to target different demographics and entice them with various add on products and special offers. However the choice of which insurer and which product to go with has just got a little bit easier as Norwich Union announced that is it withdrawing its pay as you go insurance scheme.

The pay as you go scheme was only launched at the end of 2006 and was targeted at young drivers. The aim of the scheme was to monitor motorists driving patterns to see whether they would be entitled to a lower quote. Motorists who took up the offer had their cars fitted with a little black box which recorded information on the journeys they took, the time at which they were driving, as well as the speed at which they were going. All of this data was then collected over a period of time before being analysed to determine whether the drivers should be offered lower premiums. For first time drivers they scheme could have provided a way to prove their skills as a driver, and help them obtain lower insurance premiums. It is well known that the costs of insurance premiums for new drivers can be very high, especially for men as statistics show they are more likely to be involved in an accident or make a claim than their female counterparts.

The scheme also aimed to benefit drivers who rarely drove at night. Research has shown that almost fifty percent of people killed on the roads at night are under the age of twenty-four. In order to try and combat this, the pay as you go scheme charged up to one pound per mile for night time driving. However the uptake of the policy was slow and Norwich union have decided to take the product off the market. Whilst Norwich Union believe that by doing this younger drivers will have lost an opportunity to get lower insurance premiums, the policy was not generating sufficient interest.

Norwich Union acknowledges that they believed the uptake of this type of insurance would be slow but the possibility for people to reduce their premiums considerably was the main driver behind launching it into the market. Research conducted prior to the launch showed that less than one tenth of those surveyed would want a black box tracking their car journeys even if it resulted in their car insurance premiums being reduced by up to thirty percent. An additional 27 percent of people said they would not have a box installed regardless of the amount of saving. It seems that for many people the black boxes felt too much like a big brother approach and therefore they were not willing to have it installed. For some this will represent a potential loss in savings whilst for others it will be one less product to decide between when choosing the next insurance deal.