You can pay as you talk with a cell phone plan, so why not pay as you
drive auto insurance? It sounds like a good idea; but would pay as you drive
auto insurance work for you?
The idea behind pay as you drive auto insurance
is simple. Basically its this- if you do not drive very much, you will not
pay high insurance premiums. Advocates for this type of insurance policy
think that there are many merits to this type of program.
What if you
car pool to work, or take public transit? You are not using your car very
much so why are you paying high premiums. With a pay as you drive auto insurance
premiums you would be able to quite literally pay as you go. Another situation
where this plan would be of benefit is that of many retirees who have winter
homes in temperate climates, the 'snowbirds' living in Florida or Arizona
six months of the year and six months in New York or Toronto for example.
Essentially the insurance companies would set an average driving amount
for each car type. It could then be broken down into a cents per mile basis.
If you wanted to us the pay as you drive auto insurance system you could
purchase a set number of miles and you would be covered for insurance during
this period.
Pay as you drive auto insurance is an excellent idea for
those individuals who do not use their car very much or try to find cost
saving methods or environment saving alternatives. Currently this type of
program is not yet available, but there are supporters in many states who
are hoping to change that soon.
Groups including Environmental Defense,
the Conservation Law Foundation and even the U.S. Environmental Protection
Agency are working to organize a national cooperative that would work with
insurance companies to offer deep discounts for low-mileage drivers; halfway
a step toward PAYD (Pay As You Drive) insurance.
General Motors and On-Star
Offers PAYD Rates. In mid-2004 General Motors Acceptance Corporation (GMAC)
Insurance began offering mileage-based discounts to OnStar subscribers located
in some states. The OnStar system reports a vehicle's odometer readings at
the beginning and end of the policy term to verify mileage. Motorist who
drive less than specified annual mileage can receive insurance premium discounts
of up to 40%.
PAYD programs are also currently available in Israel, South
Africa and Holland. PAYD is gaining momentum, and will be coming to your
area soon.
Posted on goarticles.com .
Visit Car Auctions at Digi-Go.biz | 06/15/2005 | Dallas, TX