Do you own a car and drive very little? Perhaps your situation is like this: oYou are elderly and only drive to and from the market.
oYou live and work in a small town, or work close to your home.
oYou travel a lot, and your car is parked at home for days or weeks at a time.
oYou are in the military, and deployed outside the US for many months at a time.
oYou own a pickup truck that you only use on weekends to run errands.
(that's me) "Pay-As-You-Drive" (PAYD) is the concept of linking the amount you pay for auto insurance to the number of miles you drive each year.
The more you drive, the more you pay.
The less you drive, the less you would pay.
Drivers would gain the most savings from Liability and Collision coverage.
If a person carried Comprehensive insurance (fire, theft, glass breakage, etc.
) on their vehicle, that likely would not change much.
A car doesn't have to be moving for there to be damages under Comprehensive coverage.
There are various ways that insurers would verify mileage under a PAYD program.
Some would use GPS tracking systems that automatically tabulate and report mileage.
Some use odometer checks or maintenance records.
The concept is becoming more popular in many states.
Some insurers are already offering PAYD discount programs in most states.
For example, Progressive Insurance and GMAC Insurance presently offer PAYD policies.
Progressive ties mileage verification to GPS, and GMAC uses the OnStar system built into many GM automobiles.
PAYD has gained a strong foothold in Europe, with insurers from the UK to Italy offering the program.
Giving people a financial reward for driving less makes good economic sense.
The devil is always in the details, but it looks like the "pros" far outweigh the "cons.
" Check with your insurance company to see if they presently offer PAYD coverage.
Or, check with your insurance agent to see if he writes PAYD coverage.
You could save some bucks!