Smart Auto Insurance Blog

Government research shows that both women and men have the same accident rates per million miles driven.  But men do have more accidents overall according to the press release from MileMeter on businesswire “Men vs Women: Who Pays Less for Auto Insurance”.  This is because men drive more miles than women on average.

Even though men drive more, many auto insurance companies such as Acceptance Insurance, are charging the same yearly premiums to adult men and women.  This means that women are paying more per mile driven than men.  Insurance discrimination occurs against all people whose cars are driven less than average.  The main way to end the group discrimination against women and other lower mileage groups and individuals is to charge by the mile, which more and more companies are turning to.

MileMeter is a company that specializes in per mile auto insurance.  This Texas based company is the first to apply per mile prices to the miles recorded on odometers.  This helps to ensure equal treatment towards men and women drivers.  They offer this benefit without installing vehicle tracking devices which many view as an invasion of privacy.  The miles are bought in advance, and more miles are purchased as needed to ensure full coverage.

According to the article “Pay-as-you-drive auto insurance gets green light” by Kelly Johnson from msn.com, California Insurance Commissioner Steve Poizner announced Friday that the state Office of Administration Law has passed regulations which allow auto insurance companies to base rates on how much drivers drive and they are now in effect.

Poizner opposed the pay-as-you-drive regulation a year ago, but now he believes it’s an innovative way to give California drivers rewards for driving less.  This will ultimately lead to lower auto insurance, less air pollution and eventually less dependence on foreign oil. 

The Association of California Insurance Companies supports the new regulation calling it “pro-consumer”.  The new regulation will give auto insurance companies and drivers an additional tool to assure that auto insurance rates reflect the driver’s actual risk of getting into an accident and filing a claim.  Insurers will have the option to offer estimated mileage, but they will now also have the option to offer verified mileage plans.

Here’s an update on what to expect from California auto insurance quotes due to the proposed pay-as-you-drive program.  According to the article “Poizner issues final pay-as-you-go auto insurance regulations” there has been some headway on the proposal. 

California Insurance Commissioner originally proposed the pay-as-you-drive regulation back in September of 2008 and just this past Thursday issued the final regulations which will allow insurance companies to offer rates based on the actual miles driven. 

Once the new regulations go into effect, insurers will be able to offer a mileage program instead of, or in addition to, current estimated mileage programs.  The hope is that the regulation will save California drivers money, and cause people to drive less which will in turn reduce emissions and reduce California’s dependency on foreign oil.

Residents may be in for a surprise when they obtain their California auto insurance quotes.  According to the article “State considers revised mileage-based auto insurance” on Central Valley Business Times’ website there is a new draft of pay as you drive regulations that has recently been released.  This revised plan may cause auto insurance quotes in California to consider how much a driver is in the car when determining the cost of a policy.  This has been in the works for months, and is backed by Insurance Commissioner, Steve Poizner. 

This article states that Poizner believes the pay as you drive concept is a cutting edge program which will create motivation for California drivers to drive less.  This will eventually lead to lower auto insurance costs, less pollution in the air, and less dependence on foreign oil. 

Some are concerned about the intrusion on privacy that the pay as you drive might create.  The Electronic Frontier Foundation says the original regulation would allow auto insurance companies to install electronic devices into their policy holders’ cars to track how much they drive.  It will also track a variety of other information such as location and seat belt wearing.  The revised plan will prohibit black boxes to track location.  Companies will use odometer readings and estimates from the policy holder as well.  It’s still to be determined how this new regulation will all pan out in the end.

By the end of the year California auto insurance may have a new option for their drivers.  According to the article “Pay-as-you-drive auto policies could become an option by year’s end” in the LA Times by Marc Lifsher, paying by the mile may be a reality.

Much like cellphone users have started to purchase talk time per minute, drivers could start buying their auto insurance by the mile.  Regulations proposed Friday by state Insurance Commissioner Steve Poizner, auto insurance companies would be allowed to offer pay as you drive which would lower insurance bills by keeping drivers from behind the wheel. 

There are other possible benefits from such a pay structure.  Less cars would be on the road to potentially curb traffic jams and gloabal warming.  There would be less greenhouse gasses emitted into the atmosphere over time.  No one would be forced to take advantage of the pay as you drive option, so drivers with long commutes to work or drivers who travel a lot may find it cheaper to stick with the conventional auto insurance ploicy.