The Brookings Institution tells us that their studies find that 2 out of every 3 households in the United States would save money if they switch their auto insurance to a Pay As You Drive plan. Pay As You Drive insurance is based on the numbers of miles an insured’s car is driven. They give you an incentive to drive less and lower your premiums.

Who should look closely at Pay As You Drive? Anyone could consider a Pay As You Drive plan, but the real winners are low-income and low-mileage drivers. Low-income drivers also tend to below-mileage drivers due to the high cost of operating their cars. While frugal usage of your car does not save you money on traditional car insurance, it is actually rewarded with Pay As You Drive. And as you save money on your car insurance, you also save money on gas, maintenance, wear and tear, and the cost of replacing your vehicle.

In addition, low mileage drivers tend to subsidize high mileage drivers under a traditional insurance program, in which drivers pay the same amount of money for insurance premiums whether they drive a few hundred miles or a few thousand miles. This subsidy is removed under a Pay As You Drive insurance program. Higher mileage drivers would pay more for their insurance under a Pay As You Drive insurance system, which makes this system a more fair and equitable way to charge for insurance premiums.

Of course, not all low-mileage drivers are low-income drivers. Many people don’t drive just because they care about the environment. The fewer miles people drive, the less automobiles contribute to greenhouse gases, and the less congestion there is on the road. Any driver interested in protecting the ecology should also consider Pay As You Drive.

Drivers interested in saving money in a tight economy would also benefit from Pay As You Drive insurance. Since the insurance premium costs are based on the amount of miles driven, there is an incentive to drive fewer miles because that?s how you save money. Drivers who utilize Pay As You Drive insurance also spend less money on gas and auto maintenance due to their reduced driving. And don?t forget that the less you drive your vehicle, the longer you can keep it after you pay for it. Vehicles tend to last longer if we drive them less.

The overwhelming majority of drivers are better off with a Pay As You Drive policy. If you want to learn how these innovative plans can lower your costs, help save the environment, and help you put off buying a new car, see your insurance agent. Your authorized insurance provider can answer all your questions and create a plan that may save you hundreds of dollars each year.

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