Do You Know of Pay Go Auto Insurance
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In past years, most auto insurance companies have tried to find different ways to respond to changing consumer needs.
Consumers all across the country are looking for some way to save some money on auto fuel as gas prices continue to be very unstable. Finances are now tightly bound by many consumer goods, including is the rising costs of gasoline and the price of paying auto insurance.
Insurance companies responded to this situation by establishing a new insurance program which is known as the pay-as-you-drive program or pay-go for short, that could provide policyholders some financial relief by way of discounted auto insurance.
Officially sanctioned Environmental Defense, the original purpose of the program was to track an individual’s car mileage. Two approaches have been proposed to achieve this end. One way to do this is to install a proprietary odometer that contains an embedded cell unit that periodically calls in your mileage to your insurance company.
One other option for tracking your travel route and reporting the mileage involves adding a GPS device into a phone in the car, which would work like the On Star system. You may want to spend some time researching each program to get more details before you make a decision on which method is the one for you.
Some people object to the GPS system, by citing issues with invasion of privacy. Using the GPS method has its advantages, however, as it not only monitors the mileage but it also advises you about the best time to travel and the easiest route to follow. You should spend time weighing the potential benefits of each method again any issues or concerns you may have with privacy.
The insurance companies are hoping that by providing financial incentive for driving less, the Environmental Defense believes that its pay-go program will eventually save the consumers some money as well as help to reduce pollution. An added benefit of these programs is that they could end up reducing driving and congestion in cities where traffic problems on overcrowded highways are prevalent.
Drivers could receive more choice about their auto insurance premiums through the pay as you drive programs, thus making auto insurance more affordable.
It is relatively simple to decide how much can be saved by a pay-as-you-drive program. 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 the per mile rate is determined you most likely will have to pay an fee for your pre-determined mileage.
The amount of time you will spend behind the wheel is what determines whether or not you will receive a rebate or pay more on your insurance premiums.
There have been calculations that put the savings to policyholders to around 25% on auto insurance coverage using such programs.
If the pay as you drive programs can save you money and reduce pollution and congested driving conditions, it could easily be the big wave of the future.
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