The premiums you pay on your auto insurance are usually based on your age, gender, and where you live. Pay as you drive insurance however is different. It’s based on the number of miles you drive. Drive fewer miles, pay lower premiums.
The obvious advantage of pay as you drive, then, is cost. Since pay as you drive premiums are computed on the basis of how many miles the vehicle is driven, it is extremely easy to reduce the monthly insurance bill. Simply reduce the number of miles driven. Not only does this save money on the insurance bill, it also means less on gas and maintenance and repair. The fewer miles driven, the longer the vehicle lasts. It may be possible to keep the vehicle long after that last car payment is made and in our tough economy, who can’t find things to do with the money that otherwise would be spent on a car payment?
The less obvious advantage of pay as you drive coverage is that you can tailor your program to your specific driving needs. Premiums under these plans are either computed on the basis of miles driven, or on the basis of hours driven. You can choose a pay as you drive policy that focuses on total miles, or total hours in a specific time period, such as six months. Pay as you drive coverage offers you the flexibility and freedom you need to choose exactly the coverage you need, and to get it at a lower cost as you economize.
Pay as you drive insurance offers an incentive to drive fewer miles, and the less you drive, the less likely you are to get into an accident. Low mileage drivers tend to be more cautious and focused behind the wheel as well.
Pay as you drive plans require mileage monitoring, but there are multiple options. It is possible to have odometer readings, just as one would at the annual safety inspection. It is also possible to have a GPS-based monitor installed in the vehicle, which allows for data uploading. And since only periodic mileage readings as needed to compute the cost of Pay as you drive coverage, the cost of monitoring will most likely be offset by the money saved in insurance premiums.
The Brookings Institution reported that two in three US households would save with pay as you drive, an average of $270 a year. In the current economic downturn, that is terrific news.
Not only does pay as you drive insurance save you money, it also helps protect the environment. Fewer vehicles on the roads mean a reduction in auto emissions. Reduced traffic also means less congestion and traffic jams, which means less time wasted in the car.
There are plenty of advantages for pay as you drive insurance. Contact a qualified insurance provider for more detailed information on an insurance plan that best suits your driving needs.