How Can You Pay As You Go Car Insurance

Many car insurance companies have tried to find ways to respond to the changing needs of consumers, over the years. As gas prices continue to soar through the roof, all across the country consumers are desperately looking for ways to save money when fueling their cars. High gas prices combined with paying car insurance premiums can really put your finances in a crunch. Insurance companies have responded by creating a new insurance program known as a pay as you drive program that could provide policy holders some financial relief.  

Officially called Environmental Defense, the program is used to track an individual's car mileage. In order to accomplish this there are two proposed ways. The installation of a proprietary odometer that has an embedded cell phone that calls in your mileage to your insurance company from time to time.   

The other method involves installing a GPS device into a phone in your car, like the On Star system, to reveal your actual travel route. If you are indecisive on which method will be for you, maybe you need a bit more information.   

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. So you need to weigh your privacy concerns against the potential benefits.

The Environmental Defense has the idea that a pay as you drive program will save the consumers money in the end and help reduce pollution, because the insurance companies will offer 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 mounting.   

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

A pay as you drive program can be simple to judge on how cost effective it is. A part of your annual premium rate would be charged into a per mile fee by assigning your car to a group, according to vehicle type and usage and 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 you will have to pay on car insurance and whether you will receive a rebate or have to pay more, will be determined by the amount of time you spend driving the car.     

Some auto insurance policy holders are estimated to perhaps be able to receive a savings of about 25% on their auto insurance if they were to use a pay as you drive program.

If our futures can be improved through the pay as you drive programs cutting the cost of insurance and relieving the congestion and pollution on our highways, it will be wonderful.