Future Concepts in Auto Insurance

Use a telephone, electricity or any other commodity and the chances are that you’ll only be charged for the actual amount of usage or consumption within a specified time period. However, road users in the United States are usually charged a set sum for their auto insurance irrespective of how often they use their vehicles. Thankfully, many companies are now adjusting their auto insurance rates as a means of rewarding drivers who spend less time on the road. Those who join car pools or use public transport on a regular basis inevitably reduce their annual mileage and this is leading to cheap auto insurance quotes whenever renewals are offered.

The future of auto insurance remains unclear but environmental groups are working alongside leading industry carriers to develop a pay-as-you-drive auto insurance option. As well as reducing vehicle usage and lowering emissions, a pay-as-you-drive auto insurance policy gives motorists a chance to control their costs themselves. Although mileage-based auto insurance discounts are still something of mixed bag, a number of leading companies have already enjoyed success when trialing pay-as-you-drive auto insurance on a provisional basis.

General Motors and On-Star have both offered pay-as-you-drive auto insurance in the last few years and both companies have relied on odometer readings to track vehicle usage. Although verification will be difficult to monitor on a national basis, early reports indicated savings of up to 40% on auto insurance rates when road users took part in preliminary trials. With pay-as-you-drive auto insurance already operating in Holland, South Africa and Israel, roads users can expect to see further innovations within the US in the very near future.

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