Lowering auto insurance premiums by driving less
Did you know that you could save on your auto insurance premium by driving less?
Drivers who recorded a mileage of low mileage are being given discounts of up to 50% on their overall auto insurance costs. However, there are some conditions like privacy concerns and the money for device to track mileage that you will have to consider before availing this discount. To top it, you will also drive a lot lesser as compared to others who drive.
Despite these catches, this 50% will be able to give you significant savings.
The Executive Director of an NGO based in San Francisco, Consumer Action, says “The devices that are designed to track mileage can accomplish everything ranging from whether you travel during daytime to the amount you accelerate and the speed you travel at.” This is the data that is used by companies that provide auto insurance coverage to evaluate how careful a driver you are.
The program called pay-as-you-drive which is an initiative of an insurance company in Ohio, located at Mayfield Village, Progressive Casualty Insurance Company, collects a $5 monthly fee from the drivers in order to make use of a small device that if plugged beneath the steering wheel. This device, though small in size, collates data which includes the time the car is driven and how many miles it travels and the number of times the speed is raised and the car is brought to a sudden stop and relays it to Progressive Insurance. Depending on the data collated from this device, the company takes a call whether you are offered a surcharge or discount.
Richard Hutchinson who is the General Manager of the car insurance company that is based on usage, Progressive Insurance says “While the discounts for a policy spanning six months can be as high as 30%, the surcharge is also equally high at 9%.” What this means is that if a person is eligible for this high a discount, then, he can pay only $400 in place of $700 as the cost for six month coverage.
The individuals who are likely to get the best discounts on their insurance costs are those who drive slow and during times when traffic is less and have an annual mileage lesser than 9000 miles. Individuals who clock less than 9000 miles each year, but drive fast and between midnight to early morning (4am), are the ones to pay a high surcharge since the risk of meeting with accidents are very high.
Hutchison also goes on to say that the average discounts offered to people is in the range of 10% to 15%.
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