Many car insurance companies have tried to find ways to respond to the changing needs of consumers, over the years. Consumers all across the country are looking desperately for some way to save some money on car fuel as gas prices are soaring. The cost of car insurance plus the rising cost of gasoline for our cars has quite a strangle hold on our finances. A new insurance program from some insurance companies has been created to offer the consumers a pay as you drive which may give some financial relief.  

The program is officially called Environmental Defense and the purpose of the program is to track an individual’s car mileage. There are two proposed ways to accomplish this. From time to time an embedded cell phone containing a proprietary odometer calls in your mileage to the insurance company.   

One other method of tracking your travel route to report the mileage involves installing a GPS device into a phone in the car, just as the On Star system works. You could probably use a little more information before you make a decision on which method is the one for you.   

Some consumers object to the GPS system, because they feel that it imposes on their right to privacy. The GPS system may have some certain advantages over the propriety odometer method of tracking mileage; it tells how many miles you travel and also the best time and easiest route to travel. What you need to do is weigh your privacy concerns against the possible benefits of the method.

A pay as you drive program may help to save money for the consumers and reduce the threat of pollution; this is the belief of the Environmental Defense because insurance companies will offer you incentives for driving less. The pay as you drive program could also reduce the congestion in cities where the highways are overcrowded and the traffic problems are extensive by reducing the number of drivers.   

The pay as you drive insurance programs could make car insurance more affordable by giving the consumers more control over their car insurance premiums.  

You can easily determine how cost effective a pay as you drive program can be for you. The pay as you drive program would charge part of your annual premium rate into a per mile fee by your car being assigned to a group in accordance with your vehicle type and usage plus your zip code. You could be responsible for paying an upfront fee for your pre-determined mileage when a per mile rate is determined. The amount of time you spend driving is what determines whether you will receive a rebate or pay more.     

It has been estimated that some policy holders could receive almost a twenty-five percent savings on their auto insurance costs with this type of program.

We must ask ourselves if the pay as you drive car insurance programs can improve our way of life, through less pollution and congestion and lower costing insurance coverage, what are we waiting for.

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Filed under: Car Insurance

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