OAI Explores Benefits of Pay-as-You-Drive Auto Insurance
Rancho Cucamonga, CA, January 10, 2011 --(PR.com)-- In their latest FAQ, the writers at OnlineAutoInsurance.com look into the standard structure and possible benefits of pay-as-you-drive programs.
A pay-as-you-drive program — also known as PAYD — is defined by the Insurance Information Institute as “a type of auto insurance where the actual miles driven has a greater impact on the cost of insurance than a traditional policy.”
Most insurers take annual miles traveled into account when setting premiums for drivers. But PAYD programs often involve a form of mileage verification that allows coverage providers to incorporate actual data on miles traveled, rather than just an estimate from the driver, into their rating calculations. This allows for smaller mileage tiers and more precise ratings, which can lead to discounts for some.
To take full advantage of one of these innovative discount programs, consumers may want to go online to get free insurance quotes with no personal info required and then check with the best priced carriers on whether they offer better low-mileage discounts than their competitors.
The logic behind providing discounts to low-mileage drivers is relatively simple. The fewer miles a policyholder drives, the fewer opportunities he or she will have to get into an accident. So by incentivizing motorists to drive less, insurers are cutting their risk.
The correlation between annual miles traveled and the number claims filed was documented in a 2008 report released by the Brookings Institution. The 2005 data from Progressive used in the report showed that an average driver who put in 30,000 miles a year, when compared to a motorist who drove 5,000 miles a year, was more than twice as likely to file a bodily injury or property damage claim.
Source: http://www.brookings.edu/~/media/Files/rc/papers/2008/07_payd_bordoffnoel/07_payd_bordoffnoel.pdf
To learn more about how to get the best prices for coverage, readers can go to http://www.onlineautoinsurance.com/quotes/no-personal-information.htm where visitors will find informative resource pages and a free-to-use quote-comparison generator that can produce a variety of personally tailored rate estimates from a variety of carriers. To access the full FAQ, visitors to the site can click on the “Questions” link in the upper right corner.
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A pay-as-you-drive program — also known as PAYD — is defined by the Insurance Information Institute as “a type of auto insurance where the actual miles driven has a greater impact on the cost of insurance than a traditional policy.”
Most insurers take annual miles traveled into account when setting premiums for drivers. But PAYD programs often involve a form of mileage verification that allows coverage providers to incorporate actual data on miles traveled, rather than just an estimate from the driver, into their rating calculations. This allows for smaller mileage tiers and more precise ratings, which can lead to discounts for some.
To take full advantage of one of these innovative discount programs, consumers may want to go online to get free insurance quotes with no personal info required and then check with the best priced carriers on whether they offer better low-mileage discounts than their competitors.
The logic behind providing discounts to low-mileage drivers is relatively simple. The fewer miles a policyholder drives, the fewer opportunities he or she will have to get into an accident. So by incentivizing motorists to drive less, insurers are cutting their risk.
The correlation between annual miles traveled and the number claims filed was documented in a 2008 report released by the Brookings Institution. The 2005 data from Progressive used in the report showed that an average driver who put in 30,000 miles a year, when compared to a motorist who drove 5,000 miles a year, was more than twice as likely to file a bodily injury or property damage claim.
Source: http://www.brookings.edu/~/media/Files/rc/papers/2008/07_payd_bordoffnoel/07_payd_bordoffnoel.pdf
To learn more about how to get the best prices for coverage, readers can go to http://www.onlineautoinsurance.com/quotes/no-personal-information.htm where visitors will find informative resource pages and a free-to-use quote-comparison generator that can produce a variety of personally tailored rate estimates from a variety of carriers. To access the full FAQ, visitors to the site can click on the “Questions” link in the upper right corner.
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Online Auto Insurance
Benjamin Zitney
909-784-2475
http://www.onlineautoinsurance.com/
Benjamin Zitney
909-784-2475
http://www.onlineautoinsurance.com/
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