Let’s assume that you are an urban dweller who spends a majority of her time in the city. You work in the city and you party in the city. The only time you leave the city is when you go for a road trip with your friends or when you are visiting your family. There are buses, subways near your location for visit so you do not need your car. Over the course of a year, you only drive your car for a few thousand miles.
Getting insurance for such a frequently used car will be a complete loss. You need a cheaper option. Many companies in Toronto offer various kinds of insurances like Home Insurance in Toronto, Auto Insurance in Toronto, and Condo Insurance in Toronto. Check with such companies for tailored auto insurance that saves you money and insures your car. Such companies often offer insurance by the mile service.
How Are Rates Set on Auto Insurance
Traditional insurance companies offer rates based on different factors, some of these factors can be controlled while others can’t. The biggest determining factor is the driving record you have, but age, home address, marital status plays also plays a vital role when deciding on the premium. Prior insurance claims history is also taken into consideration while making an insurance quotes. The number of miles you drive doesn’t get much weightage when the premium for your insurance is calculated. Owing to such factors, the auto insurance quotes offered by different companies vary from time to time.
How By-Mile Insurance Works?
Insurance companies vary their insurance style. Some companies offer rates based on mileage while others offer a general type of discount. When customers are charged based on miles driven every day, they land up saving money by a huge percentage on normal premiums.
When you enroll for such an insurance type, the insurance company sends you a plug in device for the car. This device sends data to the company on your driving habits, miles driven and if you are prone to accidents.
Who Are Eligible For This Insurance?
There are very few companies offering by-mile insurance. There are many limitations to this insurance for which, few people in certain states are only eligible. Moreover, there are factors like the condition of the car and the manufacturer which makes it a far cry for many people and state.
Though a profitable venture, people should avoid this insurance if it has not gained momentum in your area.