The COVID-19 pandemic pushed people to stay at home, resulting in a drop in miles driven. With the number of total miles driven dropping 50%, insurance companies have taken steps to issue customers with insurance refunds or credits, and more refunds could be on the way. Usually, on average, one can spend between 1,100 and $2,040 per year on insurance premium, which is a lot of money, especially in the current circumstances when Americans are driving less.
Pay per mile Insurance an option to save o insurance premiums
With less driving considering a pay per mile insurance option could save money because you will be paying a premium as per how much you drive. A pay per mile insurance is a form of premium where you pay a base monthly rate with a mileage rate per mile, and your monthly premium will change as per your previous month’s driving.
The insurance company will track the number of miles you drive every month and charge a fee per mile on top of the base rate. Most importantly, just like normal insurance, the base rate depends on age, vehicle type, gender, and driving history. Therefore will less driving; one is likely to pay less in terms of insurance premium.
It is important to note that pay per mile insurance will offer the same collision and comprehensive coverage as normal cover. The monthly billing will be different depending on the miles you will have driven the previous month.
Why pay per mile insurance
This is the best insurance alternative for part-time drivers because the less you drive, the lower the risk of accidents. This insurance is ideal for individuals who use public transport, work from home, or infrequently drive.
Most importantly, pay per mile insurance can save a lot of money, and companies prefer low mileage drivers who want to get the same premium as full-time drivers but drive less. This form of insurance can also drive people to drive less, thus reducing the impact on climate and the environment.