How does low mileage car insurance work?
Low mileage car insurance works by providing discounts to policyholders who don’t drive their vehicles that often. Commuters often pay higher auto insurance rates because they are on the road more often, which increases the risk of an accident. Low mileage auto insurance is considered low-risk and comes with lower rates. Enter your ZIP code below to compare insurance quotes for free and see if you qualify for low mileage car insurance.
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UPDATED: Jun 4, 2021
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Many people rely on their car to get them to various different and often important destinations throughout the day. It is common for people to use their vehicle to drive to the grocery store for food, to work to earn an income to support their family and more. Each time you get behind the wheel of your car, you run the risk of getting into an accident.
Car insurance can minimize your financial risk associated with accidents and other events, and it is a requirement for most drivers today. You simply have to type your ZIP code into the FREE rate comparison feature to shop for rates. While all drivers can benefit from cheap car insurance quotes to save money, other drivers may find savings in how they use their vehicle.
What a Low Mileage Discount Is
Each time a driver gets behind the wheel, he or she runs the risk of getting into a car accident. Statistically, the more miles a driver drivers, the more likely he or she is to get into an accident. Many car insurance companies take the number of miles a driver typically drivers into account when calculating auto insurance rates.
An average driver may drive about 12,000 to 15,000 miles per year, and car rates typically are based on this number of miles being driven each year. The low mileage discounts gives you the best chance to have the cheapest auto insurance quote available.
A low mileage discount offers drivers who generally drive fewer miles than this with the opportunity to save money.
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Qualifications for This Discount
Some insurance companies do not offer a low mileage discount. Those who do offer this discount may have different criteria in place that a driver must meet to qualify for the discount. For example, one insurance company apply this discount to a policy if he or she drives under 7,500 miles in a year. Another insurance company may offer a prorated discount based on a mileage scale that ranges from 5,000 to 12,000 miles.
You should first determine how many miles per year you drive, then consider shopping around for an insurance company that will offer you a great discount for your estimated mileage. Keep in mind that not only will the requirements for this discount vary from insurer to insurer, but the amount of the discount will also vary.
Who Qualifies for This Discount?
While anyone who regularly puts a low number of miles on his or her vehicle may qualify for this discount, drivers who normally qualify for this discount often meet certain criteria or share certain characteristics. These may include:
- Retirees or senior citizens
- Work-at-home individuals
- Commuters who travel a very short distance
- Those who make use of public transportation regularly
- Drivers who participate in a regular carpool
- Drivers who have access to multiple vehicles
- Drivers who use a company-owned vehicle for work purposes, including for a commute
- College students who live on campus
These criteria may not be required in order to qualify for the low mileage discount, but some drivers who meet at least one of these criteria typically will qualify for a low mileage discount with different insurance companies.
How to Shop for Coverage
If you believe you may qualify for a low mileage discount but do not currently have this discount on your policy, you may be paying far more for your coverage than you need to. This discount can allow a driver to enjoy significant savings.
Taking time to shop for car insurance coverage today can help you to identify savings that you may qualify for. In addition to finding a policy that offers you this discount, there are several steps you can take to find more affordable coverage.
Use a rate comparison website to get rate quote estimates.
This step can help you to determine which car insurance offer the lowest basic rates, but this step will not help you to identify further savings available through low mileage discounts and other discounts. Research companies that offer low mileage discounts. You can use the list of low priced auto insurers you generated from a rate comparison website to identify companies who offer low rates and who also offer this discount.
You should also take time to look for additional discounts that can save you more money. Many car insurance companies offer several different types of discounts such as multi vehicle discounts, multi policy discounts, good student discounts, safe driver discounts and more. The more discounts you can qualify for and take advantage of, the greater your car insurance savings may be. Review your coverage needs. Your coverage needs may change periodically. It is a good idea to review coverage needs on an annual basis. This step can help you to avoid paying for excess coverage that does not offer you a significant benefit.
Review your deductible amount. Many drivers can increase their deductible amount for savings. However, you should first determine if using your car insurance will be affordable if you increase your deductible. Remember that you will be required to pay your deductible every time you file a new claim.
Factors such as a decreased personal debt level and an increased level of savings may make it more cost-effective to raise your deductible for savings. Pay the full amount of your premium. It is more convenient for many drivers to pay a premium in monthly or quarterly installments, but paying the amount in full can yield savings for a driver.
Some drivers put a significant number of miles on their vehicle on a regular basis while others rarely get behind the wheel. Drivers who drive less frequently are statistically less likely to get into a car accident. Car insurance companies recognize this difference in drivers, and many offer a low mileage discount to drivers who meet a mileage requirement they have in place.
While taking advantage of this discount is one way to save money on car insurance, another way to save money is to shop around and compare insurance rates. By entering your ZIP code now, you can use the FREE rate comparison tool above to identify savings.