What Is A Pay-as-you-drive Plan?

By Author: Marcus Stalder
Total Articles: 491
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It's not that we've become a nation of dishonest people overnight. Nations don't suddenly wake up one morning and turn over a fraudulent leaf. It only comes very slowly as the culture changes to bend the rules of what is acceptable. Go back a few centuries to when we were a more traditional Christian country. At that time, there was a good understanding of "right" and "wrong". We had a moral code. There were real "family" values. Of course, there's always been an underclass prepared to do bad stuff. But the majority were all more consistently good than you will find today. Now the idea of ethics is you can do whatever you want and it's alright so long as you don't get caught. Apart from a few dangerous liberals in universities, no one actually studies real philosophy to understand how you might define ideas like "fairness", justice", "honesty" and so on. We just get on with the business of living as best we can, trying to fit into the current way of doing things.

A while back, insurance companies began wondering whether they could offer discounts to drivers based on low mileage or only driving at off-peak times. The reason ...
... was simple. People who only drive a few miles when there's little traffic on the road don't get into accidents as often as those who commute long distances to work every day in heavy traffic conditions. If the premium rate is supposed to reflect the real level of risk, low mileage drivers should pay less. Except no insurance company was prepared to trust drivers to report their odometer readings. There were a few trials based on agents inspecting the odometers on a monthly basis, but the idea never took off. Basically, the average driver was too dishonest.

Now technology has caught up with the idea. If you own a vehicle manufactured by General Motors or Saab, you are buying OnStar technology. With a little tweak to the software, your vehicle can send details of all your journeys to the insurer. Some insurers are offering a black box you can fit to your vehicle that does the same thing. A few brave companies have begun to allow self-reporting online backed up by inspection. So if you genuinely are a low-mileage driver, you'll find major savings coming your way. For example, State Farm and Progressive are offering the plan in multiple states. Other large insurers are running their own trial plans.

At a time when gas has been growing more expensive - the national average is around $3.90 per gallon - it makes sense to drive less. Think about how often you use your vehicle. Instead of jumping into it every time you think of something you need, try a little planning. If you combine journeys and make them at quiet times of the day, your premium rate will fall and you will be saving on gas - it's good for the environment as well. For the homemaker or senior, this is real cheap car insurance. The lowest rates are around $700 per year - for once, this is cheap car insurance, verified by the technology in your vehicle and bringing savings to your bank account.