How Does Total Mileage Driven Impact My Car Insurance?
How much you drive can have an impact on the price you pay for car insurance. However, calculating how much impact your mileage will have may be tricky as insurance companies often use different standards to determine who are “high mileage” drivers and how much the mileage will affect premium rates.
What Is A High-Mileage Driver?
Every insurance company is free to set its own definition of a high-mileage driver. Most companies consider driving between 12,000 and 15,000 miles per year about average, but some companies have both lower and higher limits before high-mileage premiums kick in.
Many companies assess higher premiums if the driver goes over the mileage limit for the year. This is because a driver theoretically has a greater risk of being involved in an accident for every mile he or she travels on the road. Drivers who frequently travel long distances experience more exposure to traffic in large cities and other congested areas and may also suffer from sleep deprivation on long drives, leading to greater risk of an accident.
On the other hand, drivers who do their driving primarily on rural roads may not have as much risk of an accident as someone who commutes every day in heavy city traffic. Therefore, insurance companies have varying policies on what they consider high-mileage risk and how they assess that risk.
Do All Companies Assess High Mileage Risk?
Some companies do not assess higher premiums for high mileage but rather allow certain drivers to get low-mileage discounts. This may be easier for the insurance company to track as it puts the burden upon the driver to prove he or she has not driven more than a certain number of miles per year.
In order to get a low-mileage discount, some companies require the driver to stop by an office periodically to have their odometer checked. An employee of the company will take down the odometer information and enter it into a database. As long as the driver has not gone over the mileage needed for the discount, he or she should automatically receive lower insurance rates.
Other companies assess mileage through the use of electronics. Some companies will allow their customers to plug a computerized component into the dashboard that records the number of miles driven in a certain period of time. These computerized devices may also record other information to give a picture of the driver’s behavior and qualify him or her for other discounts.
What Is A Storage Policy?
A “storage” policy is a car insurance liability policy designed for those who have a car that is rarely if ever driven. If a car is stored, it is not out on the road very often; in fact, it may never be driven beyond the confines of a driveway. Many valuable collector cars are never driven as this may lower their value. Instead, they are moved by trailer from one location to another. Other drivers may have a car that is stored the majority of the year, such as a car at a vacation home.
While some standard car insurance companies offer storage policies, a specialty insurance company may have better offers for those with special auto insurance needs.
In fact, some insurance companies specialize in insuring valuable collector vehicles and customize cars by allowing owners to determine the value of the policy. The more insurance the owner wants, the higher the price of the policy; however, owners are free to insure valuable vehicles for their full worth. These policies are often very reasonable in cost as they are covering cars that are rarely driven.
What Should I Do If I Drive Many Miles A Year?
The most important thing to do if you are a long-distance or frequent driver is to shop for car insurance from a company that will offset the higher cost of coverage with other factors. If you drive long distances but rarely visit large cities, for example, you should be able to negotiate a lower car insurance premium price. Another alternative is to look for a company that does not use high mileage as a factor in determining auto insurance premium costs.
By shopping for car insurance, you can find a company that will ensure you at a reasonable cost no matter how much you drive. Those who drive many miles every year can still qualify for a number of other discounts that can offset the cost of car insurance.