Should You Switch to Usage-Based Auto Insurance?

As a safe driver and someone who is finding that they are working from home more thanks to the pandemic or simply not using their vehicle as much, you be wondering how you can save on your auto insurance in Valatie, NY. As a result, you may be wondering which usage-based insurance program would best suit you. To help you understand what you need to know about usage-based insurance and how to determine if it’s right for you, read on.

 

What is usage-based insurance?

Usage-based car insurance programs, also commonly called pay-per-mile insurance or pay-as-you-go insurance, are growing forms of car insurance in the United States. In essence, it allows drivers to receive car insurance rates based on their individual driving statistics. This information is based on the telematic analysis of each driver. Each driver will receive a personalized insurance rate based on their own driving, factoring in their type of road used (freeway or urban), braking, and cornering. This usage-based auto insurance often enables drivers to save money both on base rates and through discounts.

 

How does usage-based insurance work?
Pay-per-mile insurance, or usage-based car insurance, works as you may expect. A driver uses an app or inserts a telematics device into their vehicle that will track their driving habits and mileage driven each day, week, and moth. This information is then fed back to the insurance agency to analyze. Your auto insurance rate will be generated based on this information.

 

Most insurance agencies will charge a very low base rate and then have a per mile fee. The per mile fee is usually cents. However, the amount can change based on the coverage you want for your vehicle and some other demographic questions.

 

Who should get usage-based car insurance?

If you tend to be a safe driver averaging very few miles behind the wheel, you are likely to benefit from this type of policy. However, if you are an unsafe driver who likes to speed and drive at night (when many insurance agencies believe that daytime driving is safer), then you may not find there is much difference in price compared to your traditional auto policy.

 

Usage-based insurance is more technologically-advanced than other types of insurance premiums. This works by constantly monitoring your car, and providing metrics such as:

  • What time of day you drive
  • How hard you brake
  • How quickly you accelerate
  • How sharply you turn
  • If you are sticking to the speed limits
  • How long you spend idling in traffic

 

Telematics collects a great deal of sensitive information. Before opting for a usage-based car insurance policy, first ask if you are comfortable with an insurance agency collecting this data. If you are unsure about benefits or coverage or have concerns about data collection, be sure to talk it through with your insurance agent.

 

Do you have any questions when it comes to your auto insurance policy? Call the professionals at Kneller Agency today to get started on quality coverage you can count on. As an independent agency, we work for you, getting you the best price and coverage from among our many providers. We work with motorists in Chatham, Copake, Valatie, and neighboring communities in New York. We look forward to hearing from you.

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