Pay As You Go Auto Insurance
The changing needs of consumers looking for auto insurance, has been the reason why insurance companies have looked for ways to respond to their needs over the years.
Consumers all across the country are looking desperately for some way to save some money on auto fuel as gas prices continue to be very unstable. Our finances are now tightly bound by many consumer goods, among which is the soaring price of gasoline and the costs involved with paying auto insurance. Insurance companies have chosen to respond to this situation by creating a new insurance program which is known as a pay as you drive program, that could provide policy holders some financial relief. Â
Officially called Environmental Defense, the program’s purpose is to use it to track an individual’s car mileage. In order to accomplish this, there are two proposed methods of operation.One method of doing this is accomplished by installing a proprietary odometer in an embedded cell phone that calls in your mileage to the insurance company.  Â
The other method to track your mileage involves installing a GPS device into a phone in your car, like the On Star system, which reveals your actual travel route. If you are indecisive on which method will be best for you, maybe you need to find out a bit more information.  Â
Some consumers object to the GPS system, because they believe that it infringes on their right to privacy. The GPS system may have some certain advantages over the propriety odometer method of tracking mileage because it tells how many miles you travel and also the quickest and easiest route to travel. You should make a comparison of your concerns for privacy and the probable benefits of each method.
The Environmental Defense has the idea that a pay as you drive program will save the consumers money and help reduce pollution, because the insurance companies will offer incentives for driving less.An added benefit of the pay as you drive program, is that it could end up reducing driving and congestion in cities where traffic problems with overcrowded highways are prevalent.   Â
Drivers could gain more control over their auto insurance premiums through the pay as you drive programs, thus making auto insurance more affordable.  Â
You can easily make a determination of how much money a pay as you drive program can save for you. This type of program will charge part of your annual premium rate into a per mile fee by assigning your car to a group of consumers according to vehicle type and the frequency of usage plus your location according to your zip code. When the per mile rate is determined you most likely will have to pay an upfront fee for your pre-determined mileage.
The determining factor of whether you receive any rebate or if you have to pay more for your insurance is the amount of time you spend driving your vehicle.     Â
There have been estimates of some policy holders being in a position to receive almost a twenty-five percent savings on their auto insurance costs with this type of program.
If our futures can be improved through the pay as you drive auto insurance programs cutting the cost of insurance and relieving the congestion and pollution on our highways, it will be much better for every one.
