Use pay as you drive to save cash
Car insurance has always been one of the most expensive costs that motorists have to pay, and that’s why Norwich Union spent so long creating their Pay as you Drive insurance. This pay as you go insurance policy quickly became extremely. The reason for this popularity was because it allows lots of people to reduce their insurance premiums.
Pay as you go car insurance quickly became too popular, too many people were signing up to the scheme. All new applicants are supplied with a small black box GPS system, and as a result Norwich Union was forced to restrict new applications until they could source more of these to keep up with the high demand.
Pay as you go insurance uses state of the art technology and offers huge benefits to both customers and insurers. A conventional insurance policy means that motorists have to pay a set premium each and every month. This premium is personalized and based on a number of different factors. Insurers use these factors to determine how risky you are, to calculate this insurers will typically look at the number of miles you travel, your age, where you park your vehicle, and how likely you are to be involved in an accident.
PAYD Insurance Premiums
When part of a PAYD Insurance program you will notice that the insurance premiums will change every month. The insurance premiums will depend on the distance you travel, the time that you travel, and the location that you are driving in. If you normally only use your car to go to work and then go to the coast for a weekend then this will result in a higher insurance premium for that one month.
PAYD Insurance Explained
The insurance company will fit a small box in your car which is a small GPS device. This system is what tracks you around the country and will find out when, where and how often you spend time travelling. The GPS system is capable of recording a number of things including:
- Where it is you are driving
- The amount of driving you do
- What time you travel
All of this information is then sent to the insurer and they will use it to calculate your monthly insurance premiums. You will also pay a basic fee to cover the basic insurance. The rest of the insurance premium will be made up depending on the number of miles you travel.
Cost of PAYD Car insurance
The cost of pay as you drive car insurance won’t only depend on the mileage that you travel; it will also depend on other factors including the age of the driver. The older the driver, the less risky they are thought to be. Any drivers between the ages of 18 and 23 will still pay much higher insurance premiums compared to people over 24.
Does PAYD Insurance really save Money?
You might think that PAYD insurance sounds great, but you don’t really care anything about it unless it really saves you money. It is of course pretty difficult to determine whether or not it will save you money as it depends on the distance that you drive. If you drive less than 6,000 miles per year then you could end up saving money, sometimes as much as 30%.
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