Pay-per-mile auto insurance could be the new HMO
Submitted by Debra Legg on Thursday, 5 November 2009
2 Comments
Why would someone who barely drives not jump at the chance to buy "pay per mile" auto insurance, which the Brookings Institute estimates will cut most people's yearly insurance costs $270 per car?
Well, for one, I remember the last time an insurance company swore I'd see dramatic savings under a revolutionary new plan. I hope someone came out ahead under health maintenance organizations - I suspect most of us did not.
For another, I'm already under a pretty simple low-milage plan: $680 a year - that's actually sane for California - and all I have to do is take my car in once a year for the agent to verify that I've driven less than 9,000 miles in the past 12 months.
I wouldn't complain if they gave me a bigger break for 4,500 miles, because with my habits and my husband's pending deployment, we'd save a bundle.
I suspect that's not the way it's going to play out in California, where state Insurance Commissioner Steve Poizner has released new regulations paving the way for pay-as-you go auto insurance. Poizner, another one of California's great gubernatorial candidates, says such plans will encourage people to drive less and reward environmentally conscious driving habits, plus more accurately tie insurance costs to risks. Weren't HMOs supposed to do something like that, too?
I might be convinced to set aside my skepticism and give it a try with a company like MileMeter, which The Sacramento Bee said is interested in California. The Texas company lets you buy as little as 1,000 miles of insurance at a time, and it requires only that you send in three photographs of your odometer over six months as verification.
Ay, but not every company is as trusting.
Prudential, which offers pay-per-mile in 16 states, isn't happy with the odometer verification. That company installs devices that track your miles in real time, plus your speed and the time of day you were driving. They promise they won't release your data - honest, they won't. Unless someone makes them.
That type of reporting, though, is actually mild compared to that of firms that believe GPS is best, because it lets you save even more if you drive less-congested routes or during off-peak hours. I'm sure they won't release you data either. Unless someone makes them.
But back to MileMeter. I picked a Dallas address at random and used otherwise correct data on my car, age and gender. I also replicated my current coverage levels. The quote came back at $487 for 4,000 miles for six months - $276 more and 1,000 miles fewer miles allowed over a year. I do get a discount for carrying a renter's policy with my current company, but that only amounts to about $50 a year. I'd still be $226 in the hole.
If the little old lady who only drives her car two miles round trip to preschool Monday through Friday can't save under pay-per-mile, I'm wondering who can. Thanks for the money-saving "help," Commissioner Poizner. I'm not voting for you for governor, either.
I just hope my current company doesn't feel compelled to "adjust" its rates to reflect the pay-per-mile competition.
Copyright 2009 Debra Legg. All rights reserved.
I pray for the day when I can assert, “I only drive 10k a year!”.
I was actually thinking of commuters like you when I wrote this, Leslie. If some companies actually set rates higher for people who drive as seldom as I do, what’s going to happen to costs for other folks?
Food »
Egg-free strawberry muffins
In part because I live in a place where egg replacer isn’t readily available and in part because I’m tired of toting ingredients when I’m on the road, I’ve been experimenting lately with baking with …
Girl Gone Wonk »
Part of the digital divide will never be bridged – so be it
Two contradictory tidbits from a CNet story this morning about an Federal Communications Commission report on expanding broadband Internet access to more parts of the country:
A third of adults who don’t have broadband at home …
Health »
Confessions of a closet snacker
Back when my job involved actually leaving my house, there wasn’t a lunchbox in the world big enough for me.
I usually ran out the door without breakfast, triggering the need to pack snack one. The …
News »
I know what I want – I just don’t see it yet
I pay $65 a month for satellite TV service, and that’s way too much considering that we regularly watch only Nickelodeon, ESPN and the local FOX affiliate. The package includes 200 channels, many of which …
Reviews »
YouTube safety mode is nothing special
It’s ironic that Google rolled out Safety Mode parental controls for YouTube in the same week that it made gmail unsafe for some folks in its careless rollout of Buzz.
Some of the early things I’d …
School days »
Milennials aren’t harder to teach. We just don’t try hard enough
It was, admittedly, a new take on the old “these kids and their short attention spans and self-absorbed natures are ruining the world” spiel.
Instead, a British education union leader blamed a culture of “instant gratification,” …
By the way
08/18/2009 | 1:34 pm
Sometimes life is all about timing. There’s a chance the soldier took his protective goggles off briefly during training in The Box – 1,000 barren square miles at Fort Irwin where soldiers prepare for desert warfare. Then ...
07/24/2009 | 9:47 pm
So there I was last month, stressing until 2 in the morning over Dad’s “welcome home” cake, worried that it would be ugly or dry or have the wrong color stars. Silly, silly girl. If I’d ...
06/12/2009 | 12:05 pm
I’m kind of frustrated this morning because I don’t have girls. I don’t even know any girls young enough to appreciate this. But if I did, I’d be all over the tutu tutorial – say that ...
05/30/2009 | 8:17 am
Poor Boots. He wakes up every morning chirping with the birds and with a cheery greeting. “It’s a beautiful day!” Somewhere along the line, though, the grind of the world beats the beauty out of it ...
05/21/2009 | 11:18 pm
On one level, it’s simple: When you’re about to fall, just let go and fall. Trying to stop the tumble or, even worse, flailing your arms and legs as you land will make it worse. Somewhere ...
05/20/2009 | 9:03 pm
05/20/2009 | 10:18 am
This one landed in my Twitter stream just as Boots was diving into a bowl of … Cocoa Puffs: “New peanut flour warning for General Mills cereals.” Luckily, he’s not the child who’s allergic and Big ...
05/19/2009 | 12:56 am
From the country that wants to censor the Internet worldwide in the name of protecting its children comes another bizarre project, also in the name of “protecting children” The British have launched a database, at a ...
05/18/2009 | 11:38 pm
Do I ever feel like a dolt after my post last night lamenting the difficulties of finding dye-free snow-cone syrups. I went to a Middle Eastern market today to pick up some hummus ingredients and ran ...
05/16/2009 | 8:16 pm
05/15/2009 | 10:15 pm
Six hundred and eight three killed in Afghanistan. Four thousand, two hundred and ninety six killed in Iraq. Many stories of incredible lives, often amazing sacrifices. This is one such story. Army Maj. Steven Hutchison survived two ...
To subscribe