Friday, July 31, 2009

Pay As You Drive Car Insurance

WTF! I have never had an accident or a moving violation yet I pay twice as much a year for car insurance than my car cost me!

You are required by law to carry a minimum amount of coverage if you own and drive a car, so why pay for car insurance that you do not use? Canada, Europe, and Japan and 35 states (of course not the one I live in) offer some form of car insurance based on the millage driven.

By plugging a GPS device into your vehicle, your millage information is tracked and transmitted to your insurance provider. After tallying this information the insurance company is offers discounts to drivers who use this pay as you go program. Some critics find the act of tracking where and when you are driving an invasion of privacy. (They have something to hide?) I would tend to believe that low mileage drivers are willing to give up this information for the incentive to save money.

The low millage driver and owners of secondary cars would pay much less than a driver who commutes back and forth to work daily. Since the rate is adjusted lower for older drivers, clean driving records and time of day, the savings on the yearly premium can be almost half of what the driver is paying at the present time.

Drives under this plan will have an incentive to look for ways to cut their millage which in turn will cut oil usage and pollution.

Whats so hard to understand about pay as you go car insurance? This is just like using a cell phone that charges only for the time used.


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