Are you looking to cut back on the amount you pay for auto insurance because you don't drive that often? Then you may want to consider pay-per-mile auto insurance as a cheap car insurance alternative to traditional insurance. Here are some key things to know about how this type of insurance works and saves you money.
Pay-Per-Mile Auto Insurance Has A Base Rate
When you hear the name pay-per-mile auto insurance, you may think that you are only paying for the mileage that you drive with your car. This is not completely true, since there is a base rate that you pay for the policy, even if you do not drive any miles with your vehicle. The good news is that this base rate is going to be far less than what you'd pay for a traditional auto insurance policy and it shouldn't be a deal breaker.
Pay-Per-Mile Auto Insurance Accurately Track Your Mileage
Be aware that the mileage that you pay for is not estimated when you use pay-per-mile auto insurance. Instead, the insurance provider accurately tracks your mileage. A device is placed in your vehicle that reports the exact mileage that you drive as well as the data of when you drive and where you drive to. This means that there should be no discrepancies with what you are charged for.
Keep in mind that the insurance provider will also ask to see your odometer to verify that it matches the number of miles that you have driven with the tracking device. This means that you cannot simply take the device out of the vehicle and drive around without paying per mile.
Pay-Per-Mile Auto Insurance Allows You To Have More Coverage At A Lower Price
Many people get the basic type of car insurance because they cannot afford the premium types of coverage. This includes things like comprehensive and collision coverage, which is not necessary but can add some much-desired protection. You can add this additional protection with pay-per-mile auto insurance and still have it be affordable. It makes the cost per mile more expensive, but can be great for those people that rarely drive and want the added protection.
Pay-Per-Mile Auto Insurance Can Be Canceled At Any Time
If you do find yourself suddenly needing to drive a lot, know that you are always free to cancel a pay-per-mile auto insurance policy at any time. You will get the prorated cost of your base rate for the rest of the coverage period, and you can apply that toward your next insurance policy.