Pay as you go car insurance, also known as usage-based insurance (UBI) or pay-per-mile insurance, is revolutionizing the auto insurance industry. This type of insurance allows drivers to pay based on how much they drive, making it an attractive option for low-mileage drivers. With advancements in technology, insurers can now offer more personalized rates, leading to potential savings for consumers. This article delves into the intricacies of pay as you go car insurance, provides a detailed look at 20 companies offering this service, and answers frequently asked questions about this innovative insurance model.
What is Pay As You Go Car Insurance?
Pay as you go car insurance calculates premiums based on the actual usage of the vehicle. Traditional car insurance typically charges a flat rate regardless of how much or how little you drive. In contrast, pay as you go insurance uses telematics technology to track your driving habits, including mileage, speed, and driving behavior, to tailor your insurance costs to your specific usage.
Benefits of Pay As You Go Car Insurance
- Cost Savings: For drivers who travel infrequently or only cover short distances, pay as you go insurance can offer significant savings compared to traditional insurance.
- Personalized Rates: Insurance premiums are tailored to your driving habits, promoting safer driving.
- Flexibility: You pay for the insurance you need, potentially lowering costs during periods when you drive less.
- Transparency: Clear understanding of what you are being charged for, enhancing trust between the insurer and the insured.
Drawbacks of Pay As You Go Car Insurance
- Privacy Concerns: Continuous monitoring of driving habits can raise privacy issues.
- Potential High Costs for High Mileage Drivers: If you drive a lot, this type of insurance might be more expensive than traditional options.
- Telematics Device Issues: Malfunctioning or inaccurate tracking devices can lead to incorrect billing.
Top 20 Companies Offering Pay As You Go Car Insurance
- Metromile
- Website: metromile.com
- Contact: 888-242-5204
- Pros: Low rates for low-mileage drivers, user-friendly app.
- Cons: Not ideal for high-mileage drivers, availability limited to certain states.
- Customer Reviews: Generally positive, with praise for cost savings and customer service.
- Allstate Drivewise
- Website: allstate.com
- Contact: 800-255-7828
- Pros: Potential for significant discounts, easy integration with Allstate policies.
- Cons: Limited savings for some drivers, potential privacy concerns.
- Customer Reviews: Mixed, with some praising the savings and others concerned about tracking.
- Progressive Snapshot
- Website: progressive.com
- Contact: 800-776-4737
- Pros: Upfront discount, easy to use.
- Cons: Possible rate increase based on driving habits, privacy issues.
- Customer Reviews: Varied, with some customers happy with discounts and others unhappy with rate increases.
- Nationwide SmartRide
- Website: nationwide.com
- Contact: 877-669-6877
- Pros: Up to 40% discount, user-friendly app.
- Cons: Only available in certain states, privacy concerns.
- Customer Reviews: Generally positive, with high satisfaction with savings.
- Liberty Mutual RightTrack
- Website: libertymutual.com
- Contact: 800-290-7933
- Pros: Guaranteed discount for participation, easy-to-use app.
- Cons: Potential for increased rates, privacy issues.
- Customer Reviews: Mixed, with some customers enjoying savings and others frustrated with tracking.
- Root Insurance
- Website: joinroot.com
- Contact: Only available through the app
- Pros: Highly personalized rates, significant savings for safe drivers.
- Cons: Requires a test drive period, limited availability.
- Customer Reviews: Generally positive, with users appreciating the savings.
- Esurance DriveSense
- Website: esurance.com
- Contact: 800-378-7262
- Pros: Potential for significant discounts, easy-to-use app.
- Cons: Privacy concerns, possible rate increases.
- Customer Reviews: Mixed, with some users happy with the savings and others unhappy with the tracking.
- State Farm Drive Safe & Save
- Website: statefarm.com
- Contact: 800-782-8332
- Pros: Up to 30% discount, integration with State Farm policies.
- Cons: Privacy concerns, not available in all states.
- Customer Reviews: Generally positive, with many users satisfied with the savings.
- SmartMiles by Nationwide
- Website: nationwide.com
- Contact: 877-669-6877
- Pros: Ideal for low-mileage drivers, potential for significant savings.
- Cons: High costs for high mileage, privacy issues.
- Customer Reviews: Positive, with users appreciating the savings for low mileage.
- Milewise by Allstate
- Website: allstate.com
- Contact: 800-255-7828
- Pros: Pay-per-mile pricing, easy integration with Allstate policies.
- Cons: Not ideal for high-mileage drivers, privacy concerns.
- Customer Reviews: Generally positive, with users enjoying the savings.
- American Family KnowYourDrive
- Website: amfam.com
- Contact: 800-692-6326
- Pros: Up to 20% discount, promotes safer driving.
- Cons: Privacy concerns, potential for increased rates.
- Customer Reviews: Mixed, with some users happy with the savings and others concerned about tracking.
- Noblr
- Website: noblr.com
- Contact: 877-236-6257
- Pros: Personalized rates, significant savings for safe drivers.
- Cons: Limited availability, requires telematics device.
- Customer Reviews: Generally positive, with users appreciating the savings and personalized rates.
- Nationwide SmartMiles
- Website: nationwide.com
- Contact: 877-669-6877
- Pros: Pay-per-mile pricing, potential for significant savings.
- Cons: High costs for high mileage, privacy concerns.
- Customer Reviews: Positive, with users enjoying the savings for low mileage.
- Travelers IntelliDrive
- Website: travelers.com
- Contact: 866-336-2077
- Pros: Potential for significant discounts, user-friendly app.
- Cons: Privacy concerns, potential rate increases.
- Customer Reviews: Mixed, with some users happy with the savings and others concerned about tracking.
- Safeco RightTrack
- Website: safeco.com
- Contact: 800-332-3226
- Pros: Guaranteed discount for participation, easy-to-use app.
- Cons: Potential for increased rates, privacy issues.
- Customer Reviews: Mixed, with some users enjoying savings and others frustrated with tracking.
- Mapfre SafeTeen
- Website: mapfreinsurance.com
- Contact: 877-224-5677
- Pros: Promotes safer driving, potential for discounts.
- Cons: Limited to teenage drivers, privacy concerns.
- Customer Reviews: Generally positive, with parents appreciating the focus on safety.
- Sainsbury’s Bank Car Insurance
- Website: sainsburysbank.co.uk
- Contact: 0800-092-3300
- Pros: Offers a telematics option for young drivers, potential for savings.
- Cons: Privacy concerns, limited availability.
- Customer Reviews: Mixed, with some users happy with the savings and others concerned about tracking.
- Admiral LittleBox
- Website: admiral.com
- Contact: 0333-220-2000
- Pros: Potential for Privacy concerns, potential for increased rates. Mixed, with some users enjoying savings and others concerned about tracking.
- AXA Drive
- Website: axa.com
- Contact: 800-367-2222
- Pros: Discounts for safe driving, easy-to-use app.
- Cons: Privacy issues, limited availability.
- Customer Reviews: Generally positive, with users praising the savings and app functionality.
- Hastings Direct YouDrive
- Website: hastingsdirect.com
- Contact: 0333-321-9801
- Pros: Promotes safer driving, potential for discounts.
- Cons: Privacy concerns, potential for increased rates.
- Customer Reviews: Mixed, with some users enjoying savings and others frustrated with tracking.
Pros and Cons of Pay As You Go Car Insurance
Pros
- Cost Savings: Ideal for low-mileage drivers who can save significantly compared to traditional policies.
- Personalized Premiums: Rates are tailored to individual driving behavior, rewarding safer drivers.
- Encourages Safe Driving: By monitoring driving habits, it incentivizes drivers to be more cautious.
- Flexibility: Drivers only pay for the miles they drive, providing financial flexibility.
- Environmental Benefits: Encourages reduced driving, contributing to lower carbon emissions.
Cons
- Privacy Concerns: Continuous tracking of driving habits can be seen as intrusive.
- Potential High Costs for High Mileage: Drivers who cover long distances might end up paying more.
- Dependence on Technology: Malfunctioning devices can lead to billing inaccuracies.
- Variable Rates: Premiums can fluctuate, making budgeting more challenging.
- Limited Availability: Not all insurance companies offer pay as you go insurance in all regions.
Customer Reviews
- Metromile: Customers praise the significant savings for low-mileage drivers but some express concerns about device malfunctions.
- Allstate Drivewise: Reviews are mixed, with many appreciating the discounts while others worry about privacy.
- Progressive Snapshot: Some users report savings, but others experience rate increases based on their driving habits.
- Nationwide SmartRide: Generally positive reviews with high satisfaction regarding savings, though privacy remains a concern.
- Liberty Mutual RightTrack: Customers appreciate the guaranteed discount, but some are wary of the tracking.
- Root Insurance: Users like the personalized rates and significant savings, though the test drive period can be a hassle.
- Esurance DriveSense: Mixed reviews with some praising the discounts and others unhappy with the tracking.
- State Farm Drive Safe & Save: Positive feedback for savings, with some users concerned about privacy.
- SmartMiles by Nationwide: Positive reviews from low-mileage drivers who benefit from the savings.
- Milewise by Allstate: Generally positive, with users enjoying the savings but concerned about privacy.
- American Family KnowYourDrive: Mixed feedback with praise for discounts but concerns about tracking.
- Noblr: Positive reviews with users appreciating the personalized rates and savings.
- Travelers IntelliDrive: Mixed reviews, with some happy with the discounts and others concerned about tracking.
- Safeco RightTrack: Mixed feedback, with users enjoying savings but frustrated with tracking.
- Mapfre SafeTeen: Positive reviews from parents, praising the focus on safety.
- Sainsbury’s Bank Car Insurance: Mixed reviews with some happy about the savings and others concerned about tracking.
- Admiral LittleBox: Mixed feedback, with some enjoying savings and others worried about privacy.
- AXA Drive: Generally positive reviews, with praise for savings and app functionality.
- Hastings Direct YouDrive: Mixed reviews, with some enjoying the discounts and others frustrated with tracking.
Frequently Asked Questions (FAQs)
- How does pay as you go car insurance work? Pay as you go car insurance uses telematics technology to track your driving habits, such as mileage, speed, and driving behavior. Your premium is then calculated based on this data, allowing you to pay only for the miles you drive.
- Is pay as you go car insurance cheaper? It can be cheaper for low-mileage drivers who drive less frequently. The savings depend on how much you drive and your driving behavior.
- What happens if I drive more than expected? If you drive more than expected, your premium will increase accordingly. It’s important to consider your typical driving habits before choosing this type of insurance.
- Are there any privacy concerns with pay as you go car insurance? Yes, some drivers may have privacy concerns due to the continuous tracking of their driving habits. It’s important to review the insurer’s privacy policies before signing up.
- Can I switch back to traditional car insurance if I don’t like pay as you go? Yes, most insurers allow you to switch back to traditional car insurance if you’re not satisfied with the pay as you go model. It’s best to check with your insurer for their specific policies.
Conclusion
Pay as you go car insurance offers a flexible and potentially cost-saving alternative to traditional car insurance, especially for low-mileage drivers. By understanding the pros and cons, researching various providers, and considering your own driving habits, you can make an informed decision about whether this innovative insurance model is right for you.
