Blog » Pay Per Mile Car Insurance

The pandemic brought major shifts to the workplace as droves of employees began working from home for the first time. Working from home or getting a remote work position is more possible than ever. The good news is that working from home can save you a good chunk of change, too. If you’ve wondered how much money you can save working from home, we break down some numbers for you but it could be hundreds or thousands of dollars.

1. Lower car insurance rates

Working from home means driving less. If you drive less, you’re at less risk and therefore your car insurance rates may drop. During the pandemic, many major car insurance providers cut their premiums. 

But there’s a better way to lower car insurance rates when working from home and that is through pay-per-mile insurance. Using pay-per-mile auto insurance, a type of usage-based insurance, you’re only responsible for paying a low base rate and several cents for every mile you drive. 
 
On average, Metromile customers have saved $741* per year making the switch, based on survey data from new customers in 2018. You can take a look at your options, but working from home and driving less should mean lower car insurance rates as well.

2. Drop in commuting costs

Working from home means paying less in other commuting costs as well. In addition to lower car insurance rates, you can reduce costs for the following. 

• Public transportation. Instead of paying the fares for the bus or metro to get to and from work, you can now pocket that cash. In fact, close to half of the commuters in the U.S. reported using public transportation less due to the pandemic. An unlimited metro card in New York City costs $127 per month. Forgoing the unlimited metro card for a year would save you $1,524 per year. Cost-per-ride is $2.75. Let’s say you still needed to take three round-trip rides per week for a year. That would be $858, still saving you money. Many cities have fairly comparable rates, so eliminating this cost or only riding part-time you stand to save a lot of money. 
• Gas. Right now gas prices are on the rise and can add a lot to commuting costs. According to data from the U.S. Bureau of Labor Statistics (BLS) Consumer Price Index Summary, the gasoline index increased a whopping 41.8% since July 2020. When you work from home, you can save a lot by filling up your tank less often than you normally would when driving to work every day. A Marketwatch article from 2018 estimates saving $444 in gas per year working from home full-time. 
• Car maintenance. The more you drive, the more wear and tear there is on your vehicle. There’s no way around that. But driving less by working from home can lead to fewer repairs or car maintenance issues. For example, you may need to get less frequent oil changes, fewer repairs, and have less likelihood of an accident. Let’s say you drove a lot before and got an oil change every three months. You may be able to cut back to twice a year, instead of four times a year, effectively saving you around $120 per year.
• Ridesharing costs. There’s a surge in ridesharing costs right now, so if you previously took Uber or Lyft to work you’re saving money by working from home. Statista has data for average ridesharing costs as of 2018, and New York commuters spent $84 per month. That would be $1,008 saved each year by cutting this cost out.

3. Not shopping as much

When you work in an office, you need to adhere to the dress code. That may mean buying suits, slacks, ties, dresses, jumpsuits, or whatever is appropriate for your workplace. Those clothes may not be cheap and caring for them with dry cleaning can add up. 

Women in particular may spend more money on makeup, nails, and hair to keep up appearances. Working from home can reduce some of those costs. Of course, you still need to wear clothes to work from home, but you may not have to wear the same things you’d wear every day at the office or pay as much for the care and cleaning of these items. A Marketwatch analysis estimates women save $400 per year working from home.

4. Dining out less

When you commute to work, sometimes you create rituals as part of the process or simply out of convenience. For example, you may hit up the local coffee shop on your way to work or dine out for lunch or get snacks on the go. A 2015 survey from Visa found that people spent an average of $2,746 on lunch each year. 

If you come home tired from a long day, you might order take-out. All of these costs can add up fast. When you work from home, you have more time freedom and can have more energy saved from not commuting. That can mean having slower mornings making your own coffee versus rushing out of the door and grabbing one on the way.

5. May be able to write off some things for taxes

If you’re a remote worker and are self-employed, you could be eligible to write off many parts of your home office. For example, the technology required for your office could be considered a business deduction. You could potentially write off a portion of your home office. It’s possible to write off $5 per square foot for up to 300 square feet, for a maximum of $1,500. Deductions reduce the amount you owe in taxes, but unlike credits, aren’t dollar-for-dollar. How much money that saves you depends on your tax bracket and income but let’s say you’re in the 15% tax bracket, you could save $225 per year.

Unfortunately, employees who work full-time from home aren’t eligible for the home office deduction. If you had a side hustle from home part of the time that may make you eligible. Whether you’re self-employed or an employee, any tax questions should be sent to a professional tax specialist who can help you with your particular situation.

6. Turning your home or the outdoors into your gym

Many gyms closed their doors during the pandemic. According to a 2021 Finder.com survey, 1.3 billion dollars is spent on unused gym memberships. During this time, you may have turned to your home or the great outdoors to be your gym. 

Instead of pricey memberships, contracts, and something that is a hassle-to-cancel, you could save money by ditching the gym and opting to work out from home or outside. For example, you could do bodyweight exercises at home or if you have weights or bands, can use them to get a workout in. You can also go biking, running, or hiking outdoors to break a sweat. According to RunRepeat.com, the average gym membership is $507 for the first year and $479 for the second. Ditching the gym for your home gym or opting to move outside could save you up to $507 per year.

The bottom line 

If you’ve ever been curious and thought just how much money do you save working from home, now you know it can be a lot. That number can vary depending on your lifestyle and cost of living but given the numbers mentioned above, you could stand to save up to $7,715/year. Being able to work from home can lead to a number of reduced expenses, fewer options and temptations to spend, as well as lead to more time and energy. As part of lowering your costs while working from home, see how much you stand to save by switching to pay-per-mile insurance.

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Melanie Lockert is a freelance writer, podcast host of the Mental Health and Wealth show, and author of Dear Debt. She’s a cat mom to two jazzy cats, Miles and Thelonious, an amateur boxer, music lover, and needs coffee to function. 

Over the past year and a half, many Americans have moved homes, even temporarily, due to the COVID-19 pandemic and increased flexibility with work. Whether you have moved for a new job, convenience, a change of scenery, or to be closer to family, there’s one thing you want to make sure you do: check your auto insurance rate.

Many Americans are missing out on savings or paying too much now that their lifestyles and driving habits have shifted.

Here’s why now may be the best time to check your current car insurance rate and shop around.

Millions of Americans moved during the COVID-19 pandemic

There’s no doubt that the COVID-19 pandemic has changed many of our lives. It’s not just our health and social norms that have changed during this time. The pandemic has also created considerable shifts in workplace culture and moving trends. 

Many people went from commuting to an office to working from home. Remote work has opened up new ways of living and working and prompted people to move closer to family or escape cities with high rates of COVID-19 infection or living costs.

Nearly 16 million Americans moved from February to July 2020, according to MyMove.com’s Coronavirus Moving Study, and the trend is likely to continue.

Neighbor’s 2020-2021 American Migration Report projects the number of Americans moving in 2021 will surpass last year’s totals. The report found that 20% more people plan to move in 2021 than 2020, primarily for job flexibility and the desire for a lower cost of living.
Notably, job flexibility wasn’t as easily accessible before the COVID-19 pandemic. With the rise in remote work and flexible work schedules, people feel more confident they can work from home and seek new places to live.

Driving habits have also shifted because of the COVID-19 pandemic

With many people now working from home or staying at home because of shelter-in-place orders and other public health guidelines, how Americans drive has changed.

A December 2020 Pew Research study found that 71% of workers were performing their jobs at home full-time or most of the time. As a result, commuting is no longer as commonplace as it used to be, and when Americans travel for work, they may be driving differently.

When COVID-19 was first declared a pandemic in March 2020, the number of miles driven across the country dropped dramatically. Recent analysis of Metromile customers nationwide found that people drove 30% fewer miles between April and December 2020 compared to the same period from the year before. Similarly, cumulative travel in 2020 reduced by 5.4%, according to the Federal Highway Administration.

Pay-per-mile auto insurance can help

Your lifestyle can affect the price you pay for auto insurance. For example, if you moved to a new area and now park your car in a new ZIP code, your premium may change. If you drive less than you did before, pay-per-mile auto insurance could help you save money.

Pay-per-mile car insurance is a type of usage-based insurance that considers how much you drive.

People who drive less than the national average of about 37 miles a day (most Americans!) are low-mileage drivers and could save with pay-per-mile auto insurance.
Metromile could save you $741 a year on average if you’re a low-mileage driver, according to a 2018 survey of new customers who switched to Metromile and saved. With Metromile, you’ll pay a low monthly base rate and then a few cents for each mile you actually drive. Pay-per-mile auto insurance helps to give you control over the price you pay for your car insurance coverage.

The bottom line

If you’ve moved over the past year and a half, it’s time to check your car insurance rate. Your rate may change based on where you live and your driving habits, and you could score a lower rate. 

Get a free auto insurance quote with Metromile, and you can see how much you might save.

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Melanie Lockert is a freelance writer, podcast host of the Mental Health and Wealth show, and author of Dear Debt. She’s a cat mom to two jazzy cats, Miles and Thelonious, an amateur boxer, music lover, and needs coffee to function.

While most states have minimum requirements for auto insurance, sometimes the coverage isn’t enough. Not every driver may be insured or have enough coverage. According to a 2021 study by the Insurance Research Council, one in eight drivers were uninsured.

Uninsured and underinsured motorist coverage can help protect you if you get into an accident with a driver who doesn’t have liability coverage or is underinsured. Here’s what you need to know about the car insurance coverage in California.

Why uninsured motorist coverage California is important?

California has minimum auto insurance requirements for every driver on the road. The minimum liability coverage in California is:

• $15,000 to cover the injury or death of a single person
• $30,000 to cover the injury or death involving more than one person or per accident
• $5,000 to cover property damage

But that doesn’t mean everyone is insured. It is estimated that 16.6 percent of motorists in California are uninsured, according to the Insurance Research Council. So, when these uninsured motorists in California end up getting into an at-fault accident, things can get messy. 

To help combat this issue, California car insurance providers must legally offer uninsured motorist coverage and underinsured motorist coverage. You can decline these coverages by signing a waiver, though that might not be the best idea. 
You can opt for uninsured motorist bodily injury, which covers medical costs for you as well as any passengers if an uninsured or underinsured motorist hits you. There’s also uninsured and underinsured motorist property damage, which covers the cost of physical damages to your vehicle after an accident.

Is uninsured motorist coverage in California required if I have health insurance?

If your primary concern is potential medical costs after an accident with an uninsured driver, you might wonder if you need uninsured motorist coverage in California if you already have health insurance. 

While health insurance can help lower costs and provide care, health insurance can also have pricey deductibles and copays. On top of that, your health insurance may not cover all the services you might need after a car accident, such as a chiropractor. 

Getting uninsured motorist coverage in California can help ensure you get access to the funds necessary for your health and wellbeing.

Getting the right amount of uninsured motorist coverage in California

If you’re considering uninsured motorist coverage or underinsured motorist coverage in California, you probably want to know just how much you need or what is the “right” amount. 

According to the California Department of Insurance, uninsured motorist bodily injury limits are equal to your liability coverage limits. If you get general underinsured motorist insurance, you’ll be covered for a limited amount if there is bodily injury due to an accident with someone who doesn’t have enough coverage to cover all the costs. 

Uninsured motorist property damage coverage in California offers up to $3,500 to cover vehicle damages due to an accident with another driver who is at-fault and doesn’t have insurance. It’s important to note that if you have collision coverage, you may not need this. On top of that, this coverage pays out only in cases where the driver is identified. So, if they drive off in a hurry, you may be out of luck if you’re involved in a hit-and-run accident.

How underinsured and uninsured motorist coverage in California works?

Let’s say that you’re on the road and get T-boned by another car. It’s not your fault, but there are major damages to your car, and you want to get your neck checked out. You have car insurance, but the other driver doesn’t. 

If you have uninsured motorist bodily injury insurance, and the driver has no coverage, your medical bills and any passengers’ will be paid for up to your overall coverage limit. The same goes for uninsured motorist property damage coverage in California. 

If the other driver is underinsured and can’t cover all the costs, both the uninsured motorist bodily injury and uninsured motorist property damage coverage can pay the difference for your medical bills and car repairs if the other party’s insurance doesn’t cover all the costs. 

For example, the other driver could have minimum liability coverage of $30,000 for injuries to more than one person. Let’s say your hospital bill is a whopping $55,000, and your car repairs that are required to fix your car total $25,000. The total cost of the accident is $80,000, but the other person only has $30,000 in coverage. When you have underinsured and uninsured motorist coverage in California, you can get help covering that difference. 

With Metromile, you can file a claim with the Metromile app soon after the accident. If you purchased underinsured and uninsured motorist coverage, and your claim is approved, a check will be on its way to help cover the costs to repair any damage to your car or other eligible expenses.

Other ways to recoup costs if an uninsured motorist hits you

If an uninsured motorist hits you, your health insurance plan may cover costs related to your healthcare. If you have uninsured motorist coverage, your health insurance is legally entitled to any proceeds from the policy as part of something referred to as subrogation. 

One option to consider is medical payments coverage, sometimes referred to as “med pay,” which covers the cost of any injuries regardless of who is ultimately found at fault. These payments aren’t part of subrogation, but you should know that the limits may not be as extensive as you need. 

Your best bet is to get uninsured motorist coverage. You can also look into an umbrella insurance policy for additional coverage and protection. If needed, you may want to consult with a lawyer or financial advisor for additional support navigating your situation.

The bottom line

Getting into an accident can be jarring and frustrating. Uninsured and underinsured motorist coverage can help cover costs if you have to deal with an uninsured motorist or someone without enough coverage.

Metromile offers uninsured and underinsured motorist coverage so that you can stay protected.

Many drivers save money when they switch to Metromile and pay-per-mile auto insurance. Drivers can save $741 a year, according to a 2018 survey of new Metromile customers who saved, and they don’t have to sacrifice their coverage or experience. You can get a free quote to see whether you might save and how much uninsured and underinsured motorist coverage costs to add to your policy.

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Melanie Lockert is a freelance writer, podcast host of the Mental Health and Wealth show, and author of Dear Debt. She’s a cat mom to two jazzy cats, Miles and Thelonious, an amateur boxer, music lover, and needs coffee to function.

If your old car is on its last legs or you’re simply ready for an upgrade, a new car may be in your future. The car buying process can feel daunting, especially if you’re not sure where to start.
If you want to know how to buy a new car, consider these eight steps to find the right car for you.

How to buy a new car in 8 steps

1. Determine how much you can afford.

Understandably, you want a deal on your car purchase. No one wants to pay more than they really should.

Before you start, it’s essential to determine what you can afford. It’s fun to think about our “dream car,” but our budgets and lifestyle may have other ideas. 

To start, determine how you will pay for your car. You can pay cash or take on auto financing. 

If you have cash on hand, fantastic! If you decide to take an auto loan to finance your car purchase, you’ll need to keep in mind:

• The overall total you’re borrowing (i.e., your loan amount)
• Your monthly payment amount
• The interest rate of the loan
• Repayment term or how long your loan payments will last

Each of these factors will typically affect the total cost of your auto loan. 

After considering your current income, existing expenses, any debt you might have, and your other financial goals, make sure your car purchase doesn’t break your budget. Your budget will need to allow for everything else you want or need in your life.

2. Research vehicles.

After determining a budget for your new car purchase, research new vehicles that fit within your budget. You’ll also want to consider your lifestyle and needs as well. For example, you’ll need a different car if you’re living alone in a city than if you have a family and need to drive your kids around town.

A good place to find different makes and models of vehicles for sale is an online car marketplace. You can research new or used vehicles for sale, like how you might buy shoes or anything else online.

When shopping for a car, you’ll want to consider durability, dependability, and the total cost of car ownership. You might also want to understand:

• Does the type of car typically need a lot of maintenance or repairs?
• Are there known issues with the type of car?
• What is the typical fuel efficiency or miles per gallon for the vehicle? 
• What is the depreciation like on this model? 
• How safe is the car?

When shopping for a car, it’s easy to look at upfront costs, such as the price of the car, the cost of any accessories or add-ons, or the fees associated with financing, but you’ll need to think about the long-term. As a car owner, you’ll also want to think about additional costs, including maintenance, repairs, gas, and depreciation as part of your budgeting.

3. Get pre-approved for an auto loan.

Cars are often expensive, so you might need to secure some financing before you can make the big purchase.

Before heading to a car dealership, look into getting pre-approved for an auto loan at a reputable bank, credit union, or lender. A good place to start is any financial institution you already have a relationship with, as they might be able to provide benefits or discounts because of your existing accounts. 

Getting pre-approved before you buy your car could also earn you a more competitive interest rate. Financing at a car dealership may not be the best available rate, and you may end up paying more than you would elsewhere. 

You also may have more leverage or room to negotiate prices or rates if you get a pre-approval ahead of time.

4. Get a car insurance quote.

On top of any monthly payments for your car and the regular costs of gas, maintenance, and repairs, you’ll also likely need to get car insurance coverage. 

The make and model of your vehicle impacts the price you pay for auto insurance. Before you make a car purchase, it could be beneficial to review average or typical car insurance premium costs for any car you’re considering.

If you don’t often drive (many Americans drive 40 miles or less every day), you could save money with a pay-per-mile car insurance policy. Car owners and drivers could save 47% a year on average, according to a 2018 survey of new customers who saved with Metromile.

5. Compare prices ahead of time and get quotes from a dealership.

Don’t start your car purchase unprepared.

It’s a good idea to do some legwork before heading to a car dealership or searching online. You’ll want to compare prices for specific makes and models so that you can easily spot if any quotes or prices are off base. 

You might find different prices for the same vehicles at different car dealerships or online car marketplaces. 

Often, you can email different dealerships and get a quote on any cars you’re considering. You can also use websites to research typical car prices and any discounts, incentives, or rebates that might be available.

When you ask for a quote, make sure you get the total cost of the car, inclusive of any taxes and fees, so that you can make fair, apples-to-apples comparisons.

Research ahead of time can keep you from getting overcharged or a lower trade-in value when you make your car purchase.

6. Schedule a test drive.

Once you’ve determined your budget and found car makes and models you like, it’s time to see if each car is the right fit for you and how you like to drive. That’s where a test drive comes in. 

Schedule a test drive ahead of time so that you can get a feel for the car and how it rides on the road. 

Plan on dedicating several hours to test driving so that you’re not rushed. Consider taking notes about features you like or don’t like on your phone, or bring a notepad with you for your test drive. Your notes can help you compare features or remind you of things you didn’t like after the test drive.

7. Score a deal.

Once you’ve found the car of your dreams, it’s time to move forward and look for the best price. 

If you have a pre-approved offer, use the quote or rate as a starting point for your negotiations.

Remember: You shouldn’t feel pressured into anything. A car is a major purchase and something you’ll have for a long time. It only makes sense that the purchase might take a long time, too.

Be sure to ask about any fees and be wary of any upsells. Consider declining any extras they try to sell you if you don’t really need them. 

You could also save money by opting for a shorter repayment term if you’re financing your car. You will have larger monthly payments, but you’ll typically pay less in interest over time.

8. Buy the car.

After you’ve done the research, taken a test drive, and determined how much and how you’ll pay for your car, it’s time to drive off with your new set of wheels. 

Before you get on the road, you’ll want to review any paperwork carefully. Don’t leave the dealership or make a purchase online without reviewing all the terms.

Don’t forget to ask about anything you don’t recognize and get any benefits, discounts, or complimentary add-ons you’ve negotiated in writing. After signing any paperwork, remember to keep a copy for yourself.

When buying a car, you can also ask if the dealership will register the vehicle for you. Car registration can be a complicated and lengthy process, but they may be able to help.

The bottom line

Buying a new car can be a rewarding process, but it can also be an overwhelming experience. These steps can help you get a good deal on your car and make an informed decision before you make a purchase.

After you make your purchase, you should also make sure you have the right car insurance coverage for your vehicle and lifestyle.

You can see if Metromile is right for you with a free trial. Download the Metromile app from your favorite app store and start a Ride Along™. After driving for about two weeks (you’ll want to keep your current insurance policy to keep your coverage during the trial), Metromile will tell you how much you could save by switching insurance companies. In some states, you can also earn up to an extra 15% off your initial Metromile quote for being a safe driver during your Ride Along™ trial.

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Melanie Lockert is a freelance writer, podcast host of the Mental Health and Wealth show, and author of Dear Debt. She’s a cat mom to two jazzy cats, Miles and Thelonious, an amateur boxer, music lover, and needs coffee to function.

Wouldn’t it be great if we could cut down one of our most expensive bills by paying only for what we use? Some car insurance companies say they want to do exactly that with pay-per-mile auto insurance.

Low-mileage drivers could save with pay-per-mile car insurance, but it can be hard to understand what that means. You might ask: If I drive every day, am I a low-mileage driver? Alternatively, how low is low?

We have the answers. Consider this guide if you’ve ever wondered about pay-per-mile car insurance or how you can keep car insurance costs low.

Quick Index

• What is pay per mile car insurance?
• How does pay per mile insurance work?
• Is pay per mile car insurance worth it?
• How much does pay per mile car insurance cost?
• How are pay per mile car insurance rates determined?
• Who should get pay-per-mile car insurance?
• What type of coverage does pay per mile auto insurance provide?
• How do claims work with pay per mile auto insurance?
• What is the difference between pay per mile and pay as you go insurance?

What is pay-per-mile auto insurance?

Pay-per-mile car insurance is a type of usage-based insurance that is determined by how far you drive. Instead of paying a flat rate that doesn’t change like with other insurance companies, your actual driving determines your car insurance premiums.

While different companies might offer pay-per-mile car insurance, sometimes called “pay as you go” car insurance or “pay as you drive” car insurance, Metromile is a leading pay-per-mile car insurance company in the U.S. The company started to create a new type of insurance personalized to each driver and their unique lifestyle.

Metromile’s pay-per-mile car insurance is currently available in Arizona, California, Illinois, Oregon, New Jersey, Pennsylvania, Virginia, and Washington state.

How does pay-per-mile auto insurance work?

If you opt for pay-per-mile car insurance, your driving determines how much you pay for car insurance each month. This can give you more control over your car insurance costs and can ensure you don’t overpay if you don’t end up driving that much. 

Because Metromile uses telematics technology, we can offer accurate and affordable coverage that considers your driving behavior. 

The way it works is that Metromile provides drivers with the Metromile Pulse, a small wireless device that connects you to your car. The device accurately and securely counts the miles you drive to help bill you every month. 

Installation is easy and can take minutes because the device plugs into your vehicle’s onboard diagnostic port, generally next to the driver’s side door, beneath the steering wheel, or around the center console. The onboard diagnostic port is the same connection your car mechanic might use to check your car’s health in the garage.

The Pulse device needs to stay connected to your vehicle at all times. The device isn’t just for calculating your pay-as-you-go car insurance but also helps power some smart-driving features. 

For example, you can find your car’s location, know when street sweeping is happening in select cities, check your miles, review your trips, and more. All of this data can empower you with information to be a smarter and safer driver. 
Some connected vehicle owners may not need a Pulse device or other additional equipment. Soon, owners of eligible Ford vehicles with built-in connectivity can opt-in and connect their vehicle so that Metromile can count any miles driven directly from the vehicle’s odometer.

Is pay-per-mile car insurance worth it?

You might be intrigued with pay-as-you-go car insurance, but the question remains: “Is pay-per-mile car insurance worth it?” 

If you’re a low-mileage driver and don’t drive that much, the savings can be powerful. 

In fact, drivers saved an average of $741 a year when they made the switch to Metromile, according to a 2018 survey of new customers who saved. Imagine what you could do with that extra savings. You could have more fun money, budget for travel, save more, or pay down debt. 

On top of the average savings, drivers can save even more.

If you’re a low-mileage driver who racks up about 48 miles per week, you can stand to save nearly $1,000 a year. Even if you drive more some weeks, you could still save on auto insurance.

Metromile also offers additional discounts to drivers who insure multiple cars on the same policy or install an anti-car theft device or other equipment to make their vehicles safer in some states. 

Of course, if you keep a good driving record and stay safe, you could benefit from lower rates for safe driving as well.

How much does pay-per-mile car insurance cost?

After you get started with pay-per-mile car insurance, you’ll notice your bill includes two parts: a low monthly base rate and a per-mile rate.

The monthly base rate helps keep your car covered, even when you’re not driving. You can think of the monthly base rate like the fee your cell phone provider might charge you to keep your telephone number and line open.

The per-mile rate counts how far you drive. The rate doesn’t consider how long you are in your car, so you won’t ever get penalized if you’re stuck in bumper-to-bumper traffic.

How much does Metromile charge per mile?

Let’s say your base rate is $29 per month, and your per-mile rate is 6 cents per mile. Your Metromile bill would be just $56 if you drove 450 miles that month.

As an added value, pay-per-mile car insurance often comes with a daily cap. With Metromile, your miles are free after driving 250 miles (150 in New Jersey) in a single day. 

The bonus lets you avoid any surprises on your bill and can help prevent stress. You don’t have to worry about “going over” with pay-per-mile car insurance and getting a huge surprise bill.

How are pay-per-mile car insurance rates determined?

Unlike traditional insurance, pay-per-mile car insurance rates focus on someone’s actual driving.

Driving behavior, including how many miles someone drives, and the car insurance coverage selected, are the main factors Metromile considers. Other factors include the vehicle and type of insurance policy. Depending on the state, Metromile also considers how long someone’s had insurance before, claims history, and other information.

In contrast, traditional insurance rates may weigh more heavily on a driver’s age, gender, marital status, credit score, ZIP Code, or driving records, depending on the company, policy, and state. 

Often, insurance companies rely on these factors to determine the risk of large groups of drivers and might not personalize rates on a more individualized basis. Instead, Metromile uses technology and observed driving to help price rates down to the mile for each driver.

Who should get pay-per-mile car insurance?

Most Americans could find value by switching to pay-per-mile auto insurance. According to the U.S. Department of Transportation, Americans drive about 13,500 miles a year on average. Now, with more and more people working from home and taking fewer personal trips, chances are you are using your car even less.

If you drive 37 miles or fewer per day, you could save money on your premiums with pay-per-mile car insurance.

Drivers who could benefit from pay-per-mile car insurance include:

• People who work from home
• People who take public transportation
• College students
• More mature and senior drivers
• Mothers, caregivers, and people who live in the suburbs
• People who share their cars online

Even if you commute regularly or spend a lot of time in your car, you could save. Pay-per-mile car insurance doesn’t charge you for how long you drive because it focuses on miles driven.

What type of coverage does pay-per-mile car insurance provide?

Metromile lets you personalize your auto insurance policy to your lifestyle and needs. That way, you won’t pay more than what you need and might actually use. 

Metromile offers four different levels of liability protection and choices for your comprehensive and collision deductibles, including:

• Comprehensive coverage
• Liability coverage
• Collision coverage
• Uninsured or underinsured motorist coverage
• Personal injury protection coverage
• Rental car reimbursements 
• Medical payments coverage 
• Roadside assistance coverage

On top of these robust pay-as-you-go offerings, you can rest assured that your car will be covered, even when you’re not paying your per-mile rate. For example, when your car is parked, Metromile will cover your vehicle with comprehensive coverage when relevant.

How do claims work with pay-per-mile auto insurance?

Pay-per-mile car insurance provides the same types of coverage as other insurance companies. Licensed insurance specialists are available, and you can file a claim 24/7, online through the mobile app or Metromile website or by calling.

Drivers can also add roadside assistance to cover lockouts, flat tires, and towing, and an allowance for rental car reimbursements, to their policy.

Metromile also has a direct repair program, which can help expedite claims by making repairs more seamless. For example, Metromile customers can get notified of updates for their repair, changes to pricing, or service delays when they work with a participating repair shop. Metromile customers can use the Metromile app or log into their online account to find a nearby participating repair shop or see if their favorite garage is on the list.

What is the difference between pay-per-mile and pay-as-you-go car insurance?

While pay-per-mile and pay-as-you-go auto insurance are both usage-based types of car insurance, how the policies calculate how you drive may differ. 

Pay-per-mile auto insurance rates are typically calculated on the number of miles you drive. 

Pay-as-you-go auto insurance, sometimes referred to as pay-how-you-drive insurance, might also consider how you drive overall and look at your driving habits in addition to how much you drive.

The bottom line

Don’t be fooled: For many drivers, pay-per-mile car insurance can provide the same coverage as other insurance companies at a lower cost.

You don’t need to sacrifice your driving experience with pay-per-mile auto insurance, especially if you don’t drive much or are driving less than you have previously.

You can give pay-per-mile auto insurance a try for free with Metromile. Download the Metromile app and take a Ride Along™ trial. You’ll drive as you usually would for about two weeks (you should keep your current insurance policy to maintain coverage), and then we’ll show you how much you could save if you switch to Metromile.
Drivers can earn an extra discount of up to 15% off your initial car insurance quote for demonstrated safe driving during your trial in select states.