Tuesday, October 21, 2008
Auto insurance by the mile: a green option?
Auto insurance companies are starting to consider auto insurance by mile. This may save consumers who drive less (like fewer than 10000 miles a year) money. It may help retirees, or those who telecommute.
One such company is MileMeter in Dallas. Insurance is purchased on an honor system for a certain number of miles. When the car’s odometer exceeds the limit, the customer must renew. The story appears on Pegasgus News here.
The company site is here and claims it just takes five minutes to purchase and print insurance cards. It’s not immediately clear if this coverage is available in all states. The quote form asks age and gender (which affect risk) but not marital status. It was not immediately clear how the coverage is regulated and capitalized. Other issues could include expanding liability coverage limits, comprehensive, deductibles, and perhaps even access to umbrella insurance.
The National Organization for Women had proposed a “Per Mile Auto Insurance Option Act” for Texas back in 1998, link here.
It is common for auto insurance companies to ask if you drive to work, and how many miles a year you drive, and offer discounts or lower quotes for fewer miles or non use in work. Sometimes insurance companies ask if you own your own home.
The possibility that more driving would increase premiums for workers who purchase this kind of coverage could become a new HR issue in the workplace.
It would sound as though this concept of auto insurance coverage could grow more popular. And it certainly comports with sustainability and with "going green."