Is Pay-as-you-drive For You?

By Author: Marcus Stalder
Total Articles: 491
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Many people are fascinated by technology. They queue during the night to be the first to buy the latest gizmo from the leading manufacturers. For them, the power of the machine is always impressive. The effects of the devices are always positive for them as individuals and on society at large. Yet, there are times when they think twice. Take the idea of GPS. If you fit a small transmitter in your vehicle, it's possible to track where a thief drives it. Assuming, of course, that the chop shop has not found and destroyed the transmitter. But it could equally be used by parents to track where their teens are taking the family car. Law enforcement might take an interest in the pattern of movement around crime scenes. As the wave of possibility expands, the individual asks what happened to a right of privacy. Spreading our net a little wider, a significant number of engine functions are now controlled by chips. This is wonderful if you want a quick diagnosis of problems, but this technology could also record how you drive. Linked to the GPS system, it could tell whether you broke the speed limit. Sudden swerves or sharp braking might ...
... indicate poor driving. Now do you want technology in your vehicle?

Well, this technology is already here and it's attracted the attention of the insurance industry. Until now, it's been forced to trust you on claims of low mileage. Now, in return for encouraging discounts, you could sign up for pay-as-you-drive (PAYD) insurance. The offer of PAYD is spreading across all states. In some, it's on a trial basis. In others like California, it's going mainstream. It's very simple. You can pay a premium directly related to the number of miles you drive, when you drive, where you drive and how you drive. This makes the choice very clear.

What value do you place on privacy? No one is going to force you to sign up for a PAYD policy but, at a time when everyone is looking to save money on insurance, how long can you afford to go without these sometimes substantial savings? For a senior who only does a few miles a month at off-peak times, the discount can be up to 40% on the standard rates. If this sounds like a homemaker who only drives to kids to and from school and shops at the mall, the same savings will apply. You will have to get auto insurance quotes from the companies offering PAYD policies to see whether the savings will be real enough. Obviously, there comes a point when the savings on mileage taper off. No more cheap car insurance at that point. So now the choice is yours. If you're into environmental issues, this is also very green. At a time we may be reaching peak oil, anything slowing down our consumption is a good thing. Climate change may also be delayed if we pump less carbon dioxide into the atmosphere from our tail pipes. So, you save money and protect the environment. That makes it a good deal, right?