The rise of keyless fob technology for drivers – and what it means for vehicle insurance.

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Rapid advances in electronic key fob technology are changing the driving experience for vehicle owners and could usher in a new era of widespread car sharing – but what are the insurance implications?

The days of drivers using a standard key to access their car are gradually on their way out – and push-button replacements have been around for a long time.

But the latest innovations go a step further.

Latest models come with systems which allow the key to be left in the vehicle, de-activated, until ‘switched on’ by a fob.

For drivers, the extra convenience of not needing to carry a key has been welcomed. But insurers have some new challenges to consider.

There is growing evidence that keyless car entry has led to a rise in vehicle theft, which could lead to a rise in premiums and exclusions.

Additionally, in the past, most insurers routinely excluded theft cover if the ignition key was left in the vehicle. Drivers with keyless fobs should check their policy closely to ensure they are adequately protected.

So, what are the activity keys?

The Land Rover Discovery Activity Key [1] solves that age-old problem of where to put your car key when you’re on a cycle ride, on the beach or have no pockets. It comes with a wristband which looks similar to an activity tracker – and can be used to keep a car safe.

Drivers can leave their normal key fob in the vehicle and then use the wristband to lock the car (simply by holding it to the letter D at the back of the Discovery). This process immediately disables the key fob inside – so anyone trying to break in will not be able to start the car.

On return, drivers can unlock the car by placing the wristband over the letter D again. The technology works thanks to a small antenna behind the letter D which is automatically activated when the car door is shut with the key fob inside. Jaguar is offering fobs using similar technology – and its model is waterproof.

So, what are the potential problems?

A rise in vehicle theft

Official government figures in the UK showed an increase in car theft in 2017, rising by 56 per cent according to data from the Office of National Statistics, with 89,000 vehicles stolen (up from 56,000 the previous year). Some suggesting that keyless entry is a major contributing factor.

Jack Cousens, the AA’s head of roads policy said: “Car thieves have clearly shunned the old- fashioned opportunistic tactics of smash and grab. High-tech techniques like relay theft are becoming standard practice for thieves.”

Not only drivers have new technology at their fingertips

Criminals as well as drivers are taking advantage of new technology.

According to a report in AutoExpress ‘relay’ theft is an increasing phenomenon for owners of cars with keyless entry.

The process sees thieves buy a relay amplifier and a relay transmitter on the dark web. [2] Then they find a house with a high-end car outside and use the gadgets to ascertain whether the vehicle has keyless entry.

One criminal stands by the car with a transmitter while a colleague waves the amplifier outside the house – if a signal is found it is automatically amplified, allowing the first person to open and drive the car away.

Insurance complications?

Activity keys are creating new complications for insurance companies as they update policies to take new technology into account where possible but some facts still remain as per normal.

Allianz for example, like many other insurers have taken the stance that until they  have greater awareness of this technology and have seen test evidence from a trusted source they are not prepared to adjust their existing policy wording.

This means that if the customers continue to use the devise, they take risk that should any loss or damage to the vehicle arise from theft or attempted theft whilst the ignition key is left in the vehicle, they would not be covered under their current policy wording.

Insurance providers are keeping a close eye on developments with this technology and if anything arises that changes their stance this will be communicated.

The security of keyless access is also an issue. Vehicle manufacturers have made improvements since 2014 when some insurance companies refused to insure certain car models if they were parked on the street rather than in a garage or secure space.[3]  But last year’s car-theft figures in the UK suggest there is still work to be done.

Drivers may find they are under increased pressure to keep cars safe by taking extra precautions. This could include turning off their keyless fobs overnight, keeping fobs in a pouch which blocks radio signals or even using a good old-fashioned steering lock to prevent theft.





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Patricia Jones

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