A very important thing many of the auto insurance companies have looked for over the years is how they should try to respond to the changing needs of consumers.
Saving money on gas is becoming a bigger priority for many consumers across the country since fuel prices remain volatile. The cost of auto insurance plus the unstable cost of gasoline for vehicles has quite a strangle hold on our finances. 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.
The purpose of this pay as you drive program, officially called Environmental Defense, is to monitor an individual’s car mileage. There are two ways that have been proposed to accomplish this. One way to do this, is by installing a proprietary odometer that contains an embedded cell phone that periodically calls in your mileage to your insurance company.
The other method to track your mileage involves installing a GPS device into a cell unit mounted in the car, similar to the On Star system, which reveals your actual travel route. If you aren’t sure about which method will be best for you, you should get more information.
There are some consumers who feel that the GPS system interferes with their right to privacy, so they do not want it for this reason. The GPS device has certain advantages over the propriety odometer method of tracking mileage, because it not only keeps track of the mileage count, it also pinpoints the right time to travel, the amount of time spent traveling and the route traveled l. What you must do is weigh your privacy concerns against the possible benefits of both of the methods.
The Environmental Defense believes that a pay as you drive program will save consumers money in the long run, and help reduce pollution, because the insurance companies will offer financial 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.
Auto insurance premiums could be controlled more by the drivers who use the pay as you drive programs and this will also help make auto insurance more affordable to them.
You can easily learn how much money a pay as you drive program can save for you. The program will charge part of your annual premium rate into a per mile fee, by assigning your car to a group, according to your zip code, vehicle type, and how often it is used. When your per mile rate has been created, you will be required to pay a set-up fee for your pre-determined mileage.
The amount of time you will spend driving is what determines whether or not you will receive a rebate or pay more on your insurance premiums.
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 the pay as you drive auto insurance programs can improve our way of life, through less pollution and congestion and lower costing insurance coverage, we need to ask ourselves why it is not more widely used.
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