Things to Know About Pay As You Drive
In case you’re not familiar with usage-based insurance, Pay as you Drive is a type of insurance based on how you use your vehicle. It’s similar to mileage-based auto insurance, but the main difference is that it’s based on time, behavior, and location, not on how much you drive.
Pay-as-you-drive is a usage-based insurance program
Using a telematics device to track your driving habits, usage-based insurance providers can offer you better rates. These devices can connect to your car’s on-board diagnostic port to record your speed and distance. You can also connect them to an insurance company’s smartphone app or to your car’s manufacturer’s online account. The device is easy to install and use.
Useage-based insurance is different from traditional auto insurance in that the insurer uses data that is real-time instead of more conventional information, like your car’s annual mileage or location. The goal is to reward you for being a good driver and avoid the costs of accidents. However, the system can be unreliable, so it’s important to know how usage-based insurance programs work.
Pay-as-you-drive insurance programs are offered by many major insurers. Check with your agent to see if your insurer offers one. Most UBI programs use an app or a plug-in device that measures your driving habits. Consumer Reports has analyzed the key factors in each insurer’s UBI system.
Using a usage-based insurance program has several advantages. First, the insurer monitors your driving habits. This information includes how much you drive and when. Some usage-based insurance programs may also track your speed and how hard you brake. This information can help you save money on your car insurance policy.
It’s more expensive for reckless drivers
If you’ve been charged with reckless driving, the cost of your auto insurance may increase dramatically. Insurance companies consider reckless driving a serious violation and often refuse to renew policies with reckless drivers. Depending on your state and other driving convictions, the increase can be anywhere from three to eleven times more than a normal rate.
Reckless driving is considered a group of driving behaviors that endanger others, such as speeding, weaving in and out of traffic, and not signaling before turning. According to Insurify’s study, drivers with reckless driving habits pay an average of $540 more per year for full coverage than those with a less reckless driving history.