What Factors Affect Gas Prices?

If you’ve ever pulled up to the pump and promptly freaked out over the price per gallon, you’re not alone. And sometimes it seems like that number can fluctuate wildly from week to week, or even day to day. So what gives? Here are some of the factors that are influencing the price of gas so you can have a better sense of what’s, er, driving costs:

  1. Crude oil costs. According to the U.S. Energy Information Administration, over 50 percent of the cost of gas is determined by the cost of crude oil — that is, oil right from the ground. The biggest determinants of these prices are supply and demand — so when production goes up, prices may go down, and vice versa. A lot of this is influenced by the economy, so you may notice that when the economy is doing well, demand for crude oil is boosted, and gas prices change too. 
  2. Taxes. They may not play a starring role in the price of gas (in September 2019, they were responsible for about 19 percent of the average American price of $2.59 per gallon), but taxes matter a ton. Taxes can also partially explain why the cost of gas varies so significantly from state to state. While the federal tax rate charged at every gas station across the U.S. is the same, each state sets its own individual tax rates, meaning some charge sales tax while others tack on environmental fees and other costs.   
  3. Distribution and marketing. You may not think of gas stations as supreme masters of sly marketing tactics, but brand appeal and distribution significantly influence the price of gas (playing about a 15 percent role in the overall cost). Even the assortment of brand-name snack items in the service station can affect the amount you pay at the pump!
  4. Location. As we mentioned with taxes, where you fill your gas tank matters. But taxes are just part of the picture. Other factors, like the distance from the original supply, retail competition, operating costs, and any disruptions to the supply can all factor into the price. If there’s a hurricane that hits the U.S., for example, that sort of natural disaster can cause refinery shutdowns or transportation issues that affect the supply and drive up costs. 

While there’s not a lot you can do about your state’s tax situation or the price of crude oil, understanding the factors that contribute to the price at the pump may help you better prepare for fill-ups. Of course, all these factors only affect the sticker price of each gallon. The number of gallons used is the part you control. Hopping on a bike, the bus, an e-scooter, or relying on your own two feet are great ways to save on gas.And, we must add, this choice can lead to savings for pay-per-mile car insurance customers, too. Get saving!

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Michelle Konstantinovsky is a San Francisco-based freelance journalist, UC Berkeley alumna, and Metromile customer.

How I Drive: Pay-Per-Mile Pays Off for Weekend Warriors

Meet Jennifer: a city-dwelling marketing professional and bonafide weekend warrior. Jennifer doesn’t drive to work, and loves using the bus to get around — but jumps at the chance to get away on the weekends to explore California’s nooks and crannies. For that, she keeps a car, and her low-mileage habits make her a perfect fit for Metromile’s pay-per-mile car insurance model.

How long have you been a Metromile customer?

It’s been about 3 years now.

Must be a good fit.

I work in downtown Oakland, and I live not too far away. It’s an easy bus ride to work, so I just don’t drive that many miles during the week.

Do you know offhand how many miles you drive a month?

Let’s put it this way: I’ve gotten that notification in the past that asks “Have you driven your car?” I joke that I can check my mileage and tell whether I’ve gone to the gym or not, because that’s the one place I always drive. If I haven’t driven anywhere I know I’ve been skipping my workout.

What do you use your car for?

I do sometimes use my car for everyday errands, grocery shopping and things like that. But what I really like to do is take advantage of where we live in California. You can get to the mountains and the beach and the country in thirty minutes. I do a lot of weekend trips, and use my car for that.

I drove to Los Angeles last weekend. I also go to the Russian River sometimes — that’s only an hour and a half away and a completely different world from the city.

It sounds like driving is about freedom for you rather than the everyday.

I really like the option to be able to get up and go when I want to. I love walking and taking the bus. (And I enjoy telling people I use public transportation, too. It’s my tax dollars at work!)

And I don’t like driving a long way to work. I’ve changed jobs many times, and every time I have a whole system: if I can’t get there within thirty minutes of driving or one hour on transit I won’t do it. I don’t care how much they pay me.

At the same time I like having the option to say, “You know what, it’s a Saturday afternoon. Let’s pick up some sandwiches, get in the car, and just go.

I go with my boyfriend, my sister, friends. I like coming up with something new: “There’s a new speakeasy, let’s go there.” Or “There’s a taqueria in a town we’ve never been to.” I like being able to just explore a new place.

Have you considered selling your car?

I’m very much a city person. But the thing is, it’s hard to get away without that car. With something like Metromile it’s more affordable to own a car and keep it in decent shape than it is to rent a car for a weekend trip.

I’d rather have it conveniently there when I need it rather than have to think about it. My car is a little Scion, a 2014 model with super low mileage. Every time I take it into the shop people are amazed at the low mileage. I probably won’t need to replace it for a while.

Do you use any of the Metromile app features?

Definitely! There’s a running joke with a friend. We go to the movies and I will sometimes drive there if the movie goes past when transit runs. They sweep the streets at night near that theater and my friend will ask if I got the street-sweeping notification.

I’ve also used the app to find my car. I’ll forget about that feature until I lose my car and then remember it’s built in with my insurance. It’s very handy.

It makes life easier?

Yes! Because of the work I do, I’m hyper aware of products I use — I always ask myself, is this is a good customer experience? That’s what I really like about Metromile. Everything’s really easy. Insurance isn’t my first language but it’s broken down so easily; all the info I need is right there in front of me.

Actually trying to please your customers should not be above and beyond, but it’s shocking how many companies don’t do that.

What is an Insurance Credit Score?

Credit: one of those oft-stressful adult considerations that we were blissfully ignorant of as children. Besides being useful when buying a car, house, or securing any other type of loan, did you know that credit is sometimes a factor in your car insurance premium? One key difference: your insurance credit score is not the same as the consumer credit score you might be more familiar with. 

If you’re scratching your head at this one, well, you’re not alone. Today we’re covering what an insurance credit score is, how it affects your car insurance rate, and how it differs from your consumer credit score.

What is an insurance credit score?

In short, an insurance credit score is a number that helps auto insurance companies predict how likely you are to have a future accident or insurance claim. This three-digit number calculated using information from your credit report, such as the age of your credit history and how many accounts you have in good standing.

How does this number differ from my consumer credit score?

Many consumers believe they have one true credit score, but this actually isn’t the case. Instead, there are several scoring models that each produce different numbers. This means your FICO score won’t exactly match your TransUnion Vantage 3.0 score (to use two common models), even though both are built from the data on your credit report.

Your insurance credit score will be different still; it also starts with your credit data but crunches the numbers differently to focus on factors that are important to insurers. Comparing a consumer credit score to an insurance credit score is comparing apples to oranges––they’re quite different and may not even use the same scale to display results. It would be a very big coincidence if the scores matched exactly!

How does my insurance credit score affect my car insurance premiums?

It’s tough to speak in absolutes when it comes to credit; every driver is different, your insurance credit score is just a small piece of the puzzle, and not all states allow insurers to consider credit history (notably, California does not allow it). But it definitely can impact rates.

According to The Zebra’s The State of Auto Insurance Report for 2019, drivers with poor credit scores (579 or less) have an average insurance premium of just under $3,000, while drivers with exceptional credit scores (800 or higher) pay only about $1,250 on average — a 58% savings. Improving your credit score several tiers, such as from fair to excellent, can lower your rates by up to 70%.

The Bottom Line

Remember, a credit score is just a shorthand that speaks to your credit history. And there are several different versions of these shorthands!Our goal at Metromile is to give our customers — with poor credit, great credit, and everything in between — greater control over their car insurance bill. By and large, they seem to appreciate it! Sound interesting? It only takes minutes to get your personalized quote.

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Julianne Sawyer is a freelance writer, app producer, and real-life Metromile customer living in the San Francisco Bay Area. 

What to Look for When Buying Used

Maybe you’ve agonized over the pros and cons of new versus used, or maybe the decision was clear from the start. No matter how you got here, you’re ready to invest in a vehicle that’s not quite new, but new to you. So now what?

Before you fork over your hard earned cash for a used ride, here are the things you need to consider:

  1. The state of the exterior. This may seem like a no-brainer, but taking careful inventory of the vehicle’s appearance is super important. Any used car is likely to show some signs of wear and tear, but if the vehicle you’re considering has uneven body panels, this should give you pause — it could indicate the car was in an accident but not expertly repaired. Areas of oversprayed or mismatched paint could also be red flags indicating that the previous owner attempted to fix and repaint the banged up car. You might want to open and close all the doors, roll the windows up and down, and see how easily the hood and trunk open and close.
  2. The state of the interior. When it comes to the interior, it’s a good idea to sit in all the seats — not just the driver’s seat — and keep an eye out for upholstery tears. The general aroma matters too (no, you probably won’t find that coveted new car smell, but you also shouldn’t be getting a stale or musty scent, which could hint at water damage).
  3. The vehicle history. You can pretty much find out everything you’d ever want or need to know about your potential car’s past by running its vehicle identification number (VIN) through a paid service like CARFAX or AutoCheck. This is the way to find out if the car in question has ever been in an accident, has any liens on it, or if there are or have been any recalls on the model. This is also the way to find out if your vehicle has a salvage title.
  4. What’s happening under the hood. When the car is turned off, take a look at the engine and keep an eye out for fluid leaks, damaged hoses or belts, and corroded batteries.
  5. Hire a pro. Even the most seasoned car experts could use some expert guidance and approval before investing in a vehicle. Some issues are super obvious on sight, and others take a trained eye to uncover. Rather than take a risk, hire a mechanic to do a thorough inspection and confirm that all is well under the hood. The upside to any fixable issues the inspection report reveals: bargaining leverage that could score you a better deal.

And remember: now that you have the car of your dreams (or at least the one that will get you from point A to point B), you’ll need a car insurance plan that fits your lifestyle. The pay-per-mile insurance experts at Metromile can get you set up quickly with a free quote.

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Michelle Konstantinovsky is a San Francisco-based freelance journalist, UC Berkeley alumna, and Metromile customer.

Car Insurance When Borrowing a Car — How Does it Work?

“Hey, can you run to the store for me real quick? You can use my car,” shouts your friend from across the room while tossing you the keys. As you hop in the driver’s seat, you break into a cold sweat. “What if I get into an accident? Will my insurance still cover me?” you mutter nervously to yourself as you shift the car into reverse.

Far and away, this is one of the most common concerns we hear from customers. Today, we’re breaking down what the basics of what you need to know when you borrow someone else’s car. Let’s get into it.

Does my car insurance cover me while driving someone else’s vehicle?

The general (general — not exhaustive!) rule of thumb is that car insurance follows the car, not the driver. Therefore, if you borrow a friend’s car, you would be covered under that friend’s car insurance policy up to the policy limits they chose. This is what’s known in the biz as “permissive use.”

It’s important to note that this counts for irregular and infrequent borrowing; if a friend drives your car to work every Tuesday, your insurance carrier may feel differently about it.

What about my mom/dad/sibling/roommate’s car?

Usually, driving-age family members who live together should all be on the same insurance policy, making it just fine to swap cars. If not, they should be formally excluded from each other’s policies; importantly, a driver is generally not covered by a policy they’re excluded from, meaning you should never loan your car to someone you’ve excluded.

Roommates who aren’t direct family members can fall in a gray area; it’s a good idea to check with your insurance carrier about what’s allowed, but usually you’ll want your roommate to either be listed on or excluded from your policy.

What is primary vs. secondary coverage?

When claims get complicated, insurance companies spend time working out who is primarily responsible — that is, taking point on paying out damages — and secondarily responsible — or kicking in only when the primary coverage is exhausted.

As we mentioned, if you give someone permission to drive your vehicle, your car insurance usually takes primary coverage status. If damage exceeds your coverage limits, the driver’s policy may take over as secondary.

Am I covered if I’m using a borrowed car for business?

Here’s where things get sticky.

Some vehicles are covered by commercial policies for business use, but it gets complicated when a car is borrowed or swapped around for a use that’s out of the ordinary, or if a personal vehicle is used for some kind of transportation service (eg, Uber, Lyft, Postmates). There are lots of ins and outs and exclusions when it comes to commercial use, so it’s worth doing your homework before borrowing a car in a situation like this. 

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We hope this helped demystify the insurance implications of borrowing a car! But remember: when in doubt, check the specifics of the car insurance policy in question before getting behind the wheel. If you have any lingering questions (or any questions at all, really), do get in touch. We’re here to help!

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Julianne Sawyer is a freelance writer, app producer, and real-life Metromile customer living in the San Francisco Bay Area. 

Am I a Low Mileage Driver? Some Telltale Signs that Don’t Require Studying your Odometer

Hey, we get it — it can be hard to know if pay-per-mile insurance is right for you. Maybe you’ve seen one of our commercials and thought, “Sounds interesting, but I’m not a low mileage driver.” But have you ever stopped to figure it out for sure?

Drivers come in all shapes, sizes, and styles, and today we’re exploring some of the different types of low mileage drivers. Whether you’re curious if you meet the criteria or haven’t given it much thought at all, we have some telltale signs that you might be a low mileage driver, without ever having to stop and study your odometer. 

You can’t remember the last time you filled your gas tank. Filling the gas tank is an expensive chore that most of us dread, but you don’t seem to have that issue. If you find that your trips to the gas station are few and far between, you may be a low mileage driver.

You’re in the car often, but your trips are quick. Quick trips don’t add up to very many miles. In fact, your neighbors are used to seeing you cruising around the neighborhood a few miles at a time. If you find yourself shuttling the kids to and from school with short trips to run errands in between, you may be a low mileage driver.

You don’t drive to work. Even with long road trips on the weekends and drives to visit friends, you’re not clocking many monthly miles. Whether you work from home, take transit, or ride a bike, opting out a daily car commute to the office likely makes you a low mileage driver. 

You’re a wild card — no two days are the same for you. Some days, you may find yourself running endless errands around town. On other days, leaving the house is a rarity. Whatever your schedule may be, it’s unpredictable, which may make you a low mileage driver.

You’re not stuck to one form of transportation. You’ve been known to take the bus, ride a bike, use ride-sharing apps, take the train, and drive a car––all within the same week. Multi-talented transportation gurus like you are often subsidizing heavy drivers in the insurance risk pool. Want to quit that? Pay-per-mile was made for drivers like you.

You’re a car aficionado who owns multiple whips. If cars are your passion and you consider yourself a collector in-the-making, you’re probably a low mileage driver. Metromile makes a lot of sense to cover the vehicles that don’t get as much drive time. 

You dig walking. If your two legs are your main form of transportation, we feel confident that you’re a low mileage driver. Despite being great for your health, walking everywhere is great for your wallet, too. If you find yourself logging miles on your pedometer instead of your odometer, you’re probably a low mileage driver. 

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Whatever your lifestyle, if you found yourself nodding along while reading you may be a low mileage driver. Armed with new knowledge, be sure to grab a free quote from us to find out how much you could save by switching to Metromile. See you on the road!

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Julianne Sawyer is a freelance writer, app producer, and real-life Metromile customer living in the San Francisco Bay Area. 

Rainy Day Driving Tips

Confession: I like rainy weather. But the thing is, it’s really only fun when you’re safe and dry indoors. Trying to change lanes, merge, and maneuver on wet, slippery roads? Usually not so fun.

And it can also be dangerous; according to the U.S. Department of Transportation, the vast majority of most weather-related crashes happen on wet pavement and during rainfall. But since most of us will eventually have to leave the house during the rainy season, it’s worth reviewing some of the must-know safety tips before getting behind the wheel in a storm. 

  1. Take it slow. This may sound exceedingly simplistic, but speed can be a major issue during and after rainfall. Because wet roads can cause your tires to lose traction, your car can become a lot more difficult to handle, even if you’re a pro. And if it doesn’t feel safe, don’t feel compelled to stick to the posted speed limits as your max — if it’s not safe to go that fast, don’t.
  2. Hold the steering wheel with both hands. Yes, we’re all guilty of occasionally steering with one hand while the other twirls hair/reaches for snacks/searches for gum in the bottom of your backpack. But one-handed steering is never a good idea — especially when the roads are wet and unpredictable.
  3. Keep your windows frost-free. Precipitation from the rain can hinder visibility, so always use your front and rear defrosters to keep your windshield and windows clear.
  4. Keep your distance. Breathing room is always a good idea when it comes to driving behind other vehicles, but it’s particularly important to increase your following distance in the rain where braking might take longer.
  5. Use your headlights. No matter where you live, state law requires headlights in low visibility conditions, and some states also require headlight use any time the windshield wipers are turned on.
  6. Now’s not the time for cruise control. When the roads are covered in rain or snow, there’s a risk for hydroplaning — your tires losing traction on the water topping the road. It doesn’t take much water for hydroplaning to occur, and if it does, it causes your vehicle to slide uncontrollably. Cruise control while hydroplaning is a recipe for a faster, more chaotic slide.
  7. Consider…not driving. Look, there are other ways to get around. Grab your raincoat and jump on a bike, on the bus, or just walk. It’s refreshing, healthy, and when you get where you’re going people will probably find you impressive. (Need we also mention you’ll save money on insurance if you’re a pay-per-mile customer?)

Rain or shine, you’ll need an insurer who’s got your back. Grab a quote today.

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Michelle Konstantinovsky is a San Francisco-based freelance journalist, UC Berkeley alumna, and Metromile customer.

Buying New vs. Buying Used: the Pros and Cons

A few months ago, the 1995 Lexus ES I’ve had for 15 years finally let me know that she’s pretty much done with this driving thing. Despite her major scratches and significant dents, Lexi (yes, of course that’s her name) has continued to serve me well since the early 2000s. She came at an unbelievably good price with next to no mileage; her previous owner had (literally!) been a little old lady who only drove her to and from the supermarket. As far as used cars go, I hit the jackpot with Lexi. But when a number of things started to break down, my mechanic gently broke it to me that my beloved Lexi might be on her last legs. 

While I’ve started making peace with her impending departure, I haven’t been able to bring myself to start car shopping. The main reason? I don’t know where to start. I’ve never owned a new car — is now the time in my life to get one? Or based on my incredible track record with Lexi, is a used car the best bet? I figured the only surefire way to jumpstart my search is to turn it into an article that will hopefully help others in their car buying quest. So here are the pros and cons to new and used vehicles:

The Pros of Buying New

  • It’s a new car! New feels pretty good. Enough said.
  • That warranty though. One of the major perks of buying new is the fact that if anything malfunctions early on, you’ve got paperwork to cover you for a certain amount of time. 
  • The tech is next-level. My poor Lexi was manufactured so long ago, she managed to live through both the introduction and obsolescence of CD players. Her sophisticated tape deck has been defunct since 2011. By comparison, some new car models can parallel park for you!

The Cons of Buying New

  • Depreciation is real and it’s rough. Vehicles are automatically worth less once they’ve been owned and most cars depreciate by about 40 percent during the first three years of ownership — a huge chunk!
  • Insurance costs may be higher. Generally, a more expensive vehicle will mean more expensive premiums.
  • The newness factor wears off fast. It doesn’t take much for that pristine new vehicle to look less than stellar; the initial thrill may not last long. 

The Pros of Buying Used

  • Here’s your chance to be a super saver. For bargain hunters, used car shopping can be exciting. And depreciation takes far less of a bite out of a used car.
  • You’ll know its reputation. You’ll know which models have a history of reliability.
  • You can still get a great warranty. You may be able to find a ride with a warranty still in effect, or buy from a used dealer that includes one.

The Cons of Buying Used

  • The great unknown. You just can’t know how the previous owner treated the vehicle. There’s always a risk of discovering something unpleasant about your car’s history down the line when you buy used. 
  • You can’t always get what you want. When you buy used, you don’t get 100% control over the bells and whistles.
  • You may spend more in other areas. A used car might need attention from a mechanic sooner than a new one will, and used cars are, on average, less fuel efficient than newer models.

The Bottom Line

At the end of the day, the decision is yours. There are potential risks and benefits to buying both new and used cars, so take some time to figure out what matters most to you in your purchase. (Maybe you don’t want that car at all and should switch to a scooter!) No matter what you decide, make sure to choose an insurer who has your back.

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Michelle Konstantinovsky is a San Francisco-based freelance journalist, UC Berkeley alumna, and Metromile customer. 


Why Did My Car Insurance Bill Go Up? (Part 2)

A few weeks ago we looked into the main factors that impact car insurance rates. Some factors are personal — say, an accident, traffic ticket, or policy change. But insurance is ultimately about pooled risk, and other factors are common to an entire ZIP code, region, or state — things like crime, natural disasters, or a tendency toward riskier driving.

So what might that look like in real life? To speak very broadly, your risk falls into three categories: your driving, your car, your surroundings. Today we’re diving in again to explore some specific circumstances that could prompt a change to your insurance bill.

Same safe driver, different roads

Imagine you’re a safe driver, without a ticket or accident in recent memory. You move from a small town to a larger city, bringing your safe driving habits along with you. Here’s the trouble: there are a lot more cars in that larger city, a lot more traffic, and probably a higher likelihood of an accident. Even though you haven’t changed, the roads you’re driving on have. That affects risk, and thus rates.

Same driver, new car

Life is good, and you’ve treated yo’ self to a new ride. This might not affect the likelihood of an accident, but it could affect the cost of an accident were you to have one. New cars come with fussy on-board technology, expensive parts, and fancy safety features, all of which has recently tended to make car repair more expensive. In insurance jargon, this is known as “severity”; even if the frequency of crashes stays the same, they’re more expensive (severe) when they happen.

Same driver, same roads, different neighbors

Remember how we said insurance is about pooled risk? Well, just like moving to a new area can impact the risk around you, so too can changes to your area. Maybe your area is popular, and more people have moved there. Maybe it’s experienced a rash of car thefts. Maybe your mild-mannered neighbors moved away, and drivers with riskier habits moved in. You might notice this moving the needle come renewal time.

Same roads, new driver

You haven’t moved, you haven’t changed cars, and your neighborhood is just as safe as always. One big change, though: your teenager started driving and was added to your policy. A new driver can be risky — especially when that driver has a teenage brain. You’ll almost certainly see a new driver reflected in your rate.

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Note that in many of these and similar circumstances, the reverse might also hold true; you could find yourself with a lower car insurance bill after moving out of a crowded city, shifting to a less expensive car, or if your neighbors start having fewer accidents.

Of course, pay-per-mile insurance gives you more personal control of your bill. Had a life change and need a competitive rate? Give us a shout.

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Jeff Rutledge is Sr. Manager of Communications at Metromile.


Three Things Every Driver Should Know How to Do

As a seasoned driver with nearly two decades of experience behind the wheel, I have a horrifying confession to make: I don’t know what I’m doing. Yes, I can merge onto the freeway (but I hate it) and I can even parallel park (most of the time). But when it comes to basic car maintenance skills, I’ve got nothing.

So, in an attempt to bring myself up to speed on the topics I wasn’t taught in Driver’s Ed, I did some digging and identified three (very) basic things every driver should know how to do. Whether you already have these mastered, need a refresher, or, like me, are a complete noob, here’s a quick guide:

How to Check Tire Pressure

  1. Start with “cold” tires — that is, tires that haven’t recently been driven.
  2. Check your manufacturer’s recommended PSI (i.e. pounds per square inch of pressure). 
  3. Remove the valve cap from one of your tires and insert the pressure gauge into the valve stem — if you’re using a digital gauge, it should start reading the pressure immediately; if you’re using a “pencil-style” gauge, the gauge will pop out and display a measured number. 
  4. If the reading you got was too high, release some air from the tire, and if it was too low…fill it up! This may mean a trip to a gas station if you don’t own an air compressor.

How to Check Tire Tread

  1. Insert a penny into the groove of the tire with Lincoln’s head pointing down.
  2. If the top of his head isn’t covered, it’s time to replace your tires.
  3. (Alternatively, do the same test with a quarter; when you can see the top of Washington’s head it’s time to start thinking about new tires, even if the situation isn’t quite as urgent as with a penny.)

How to Jump Start a Car

  1. Be sure to travel with a set of jumper cables in your trunk at all times. 
  2. Make sure neither car is running.
  3. Attach one of the red clips of the jumper cables to the positive terminal of your battery and the other red clip to the positive terminal of the second car’s battery. 
  4. Attach one of the black clips to the negative terminal of the other car’s battery. 
  5. Attach the second black clip to an unpainted metal surface on your car that’s not close to the battery (i.e. one of the metal struts holding the hood open). 
  6. Have the other person start their car and let the engine run for a few minutes. 
  7. Try to start your car. If it starts, awesome! Drive around for at least 15 minutes to let your battery recharge. If it doesn’t start, you may need to call a tow truck and get that battery replaced. 

Even low mileage drivers need to keep an eye on their cars. Need more helpful driving tips — or just need an insurance company that gets you? We’re here.

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Michelle Konstantinovsky is a San Francisco-based freelance journalist, UC Berkeley alumna, and Metromile customer.