Want Cheaper Car Insurance? Pay Only for Your True Risk
Filed under: Car Insurance News
One of the latest innovations in car insurance is the pay as you go system. Instead of paying an average rate based on the demographics in your zip code, you pay for the real risks that you incur based on your real life driving habits. All you have to do is install a small electronic device under your steering wheel. The device will report your mileage and other driving information to the insurance company. Your rates adjust based on the information reported from your car.
Eliminate the Extra Costs of Averages
When an insurance company creates general rates for people who live in a certain zip code, they have to consider the worst drivers as well as the best drivers in the area. They also baser insurance rates on the average number of miles a driver is likely to travel in a normal year. If you are an exceptional driver who doesn’t usually drive more than a few miles a week, you are paying too much for your insurance. The other drivers who put many miles on their cars are pushing rates up for the entire group. Pay as you go policies eliminate wasted car insurance premiums because you pay for your true risk instead of taking on the average of all drivers in the policy pool.
Snapshot Tracks Your Driving Habits
The insurance companies can track your mileage and other driving habits through a small electronic device plugged in under your steering wheel. Progressive has named this device the Snapshot. When you sign up for a pay as you go policy with Progressive, they will send you a Snapshot that you can install yourself. The Snapshot will record your mileage, the time of day you drive, and any time you accelerate or stop too quickly. Progressive can create a customized insurance policy for you based on your specific driving habits while Snapshot is installed.
More Conscientious Driving
Pay as you go programs can cut your insurance costs by as much as 30 percent over the course of a year. Most people begin to drive more carefully once they install Snapshot because they know someone is monitoring their driving behaviors. This extra level of attention to your driving could help you avoid an accident, which is a more passive way of keeping your insurance costs down.
Control Your Own Insurance Costs
The Snapshot program gives you the ultimate control over your car insurance costs. If you want to keep your costs down, you can organize your driving so that you drive fewer miles on a regular basis. Consolidating trips and finding alternative transportation can cut your insurance costs dramatically when based on your actual driving patterns. People who participate in pay as you go programs tend to save money on their insurance, but they also save money on car maintenance and fuel because they find ways to drive their cars less often. It’s simple to adjust your insurance by changing your driving habits.
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Posted on June 22nd, 2011 by Elizabeth Martin
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