Pay As You Go Car Insurance – A Boon to Combat Recession
With recession refusing to budge from where it is and with consumers getting increasingly conscious of how much they spend and on what, the pay as you go car insurance concept is picking up pace more than ever before.
Previously, the headway on reducing expenditure in terms of car insurance was termed as being difficult as owning a car meant paying insurance, whether the car is driven or not. Nevertheless, this is no longer the cause of concern for consumers with the advent of “pay as you go car insurance” options.
This type of innovative insurance has been launched leading insurance companies and the others are in close following. Apart from USA, this is also available in other countries such as Japan, UK, Canada and Africa, amongst others.
The pay as you go car insurance uses the technological advancements of GPS technology to track distance travelled and even driving behavior such as repeated accelerations, and sudden stops and starts. The device is hardwired into the car to transmit information back to the insurance company, who then use the data to charge the customer.
Since the concept is fairly new, almost all the insurance companies levy good discounts for registration and subsequently to drivers with low mileage. Extra bonus discounts can be offered if the driver maintains excellent driving records.
This can be especially advantageous for people owning more than one car where one has lower mileage than the other.
Since pay as you go car insurance can be availed only when you are driving, it gives people an added impetus to avail public modes of transportation or walk which has manifold health benefits. Other than that, this works as an excellent resource for those who have just attained adulthood and thus have to pay very high premiums.
The main disadvantage of this system is the loss of privacy as your every movement is tracked and this being only available to people who average less than 10,000 miles per year. The other variables of pay as you go car insurance programs is that the rates vary during the day, the initial cost of the installation of the device is high, and that if you were to exceed the delimited number of miles then you would have to pay penalty fees.
However, if you can work around the variables, then pay as you go car insurance options work well for those who want to save some money.
