Auto Insurance
Is Pay-Per-Mile Car Insurance Worth It? The Best Options
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MW
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Updated: May 20, 2024
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Pay-per-mile car insurance adjusts your premium based on the number of miles you drive. MetroMile is the most well-known car provider that exclusively offers pay-per-mile insurance. Major names, like Nationwide and Allstate, are also beginning to provide pay-per-mile policies across the country.
This insurance model shouldn’t be confused with behavior-based insurance, which measures not only how much you drive but the quality of your driving. Root is the most notable behavior-based car insurance company, but traditional Insurers are expanding these programs too.
Pay-per-mile and behavior-based insurance may be unique coverage options, but are they right for you? MoneyGeek helps you explore your options so you can find the best auto insurance policy for your needs.
Table of Contents
Why Trust MoneyGeek? MoneyGeek helps consumers compare car insurance quotes to illustrate the importance of exploring your options when looking for a policy. The cost of car insurance varies based on your location, driver profile and the coverage levels you prefer. To help you find the best option for you, MoneyGeek gathered thousands of quotes from several companies in different ZIP codes.
83,056Quotes Analyzed
46Companies Compared
473Zip Codes
What Is Pay-Per-Mile Car Insurance?
Pay-per-mile is a type of auto insurance policy best suited for low mileage drivers. Instead of charging a flat monthly rate based solely on factors like driving history, age and location, pay-per-mile policies also factor in how much you drive. These policies typically add a cost-per-mile to your base insurance rate, charging you a few cents for every mile you drive.
MetroMile specializes in pay-per-mile insurance policies. Other popular insurers — like Allstate, Liberty Mutual and Nationwide — offer pay-per-mile programs in select states. Note that pay-per-mile programs aren’t the same as behavior-based insurance, which tracks not just how much you drive but how safely you drive.
How Does Pay-Per-Mile Car Insurance Work? Should You Get It?
According to MoneyGeek’s research, pay-per-mile car insurance is only the cheapest auto insurance policy for people who drive infrequently. Here’s how pay-per-mile insurance plans typically function:
- An insurer calculates your base rate and rate per mile.
- Base rates and per-mile rates depend on your age, location, driving history and insurer.
- Say an insurer may offer you a base rate of $60 per month and 10 cents per mile driven. If you drive 1,200 miles per month (about 40 miles per day), you’ll pay $120 per month for the miles you drive and $60 for your base rate, or $180 per month.
Should You Get Pay-Per-Mile Car Insurance?
There’s no way to know with certainty that pay-per-mile car insurance will save you money until you get a quote. However, rates from the leading pay-per-mile provider — MetroMile — suggest that a typical driver would have to drive less than 26 miles per week to save money with a pay-per-mile plan.
To help give you an idea of how much you might pay with pay-per-mile insurance, MoneyGeek obtained quotes from MetroMile in Illinois for a typical car insurance policy. We found that MetroMile charged our sample driver a base rate of $57 per month and 8 cents per mile. On average, MetroMile charges drivers who drive less than 26 miles per week $65 a month for insurance. The same coverage with GEICO costs about $66, while AAA charges $139.
Pay-Per-Mile Car Insurance Rates
Insurer | Monthly Rate | |
|---|---|---|
1. | Metromile (26 miles per week) | $65 |
2. | GEICO | $66 |
3. | Mercury | $72 |
4. | Country Financial | $72 |
5. | USAA | $73 |
6. | State Farm | $79 |
7. | Metromile (65 miles per week) | $80 |
8. | Erie | $84 |
9. | Progressive | $85 |
10. | American Family | $90 |
11. | Travelers | $94 |
12. | Allstate | $98 |
13. | Metromile (130 miles per week) | $103 |
14. | Farmers | $111 |
15. | MetLife | $116 |
16. | Nationwide | $123 |
17. | AAA | $139 |
18. | Metromile (260 miles per week) | $149 |
If you’re interested in pay-per-mile insurance, note that you may have trouble finding a policy. MetroMile is available in just eight states. Only three of the biggest insurers in the country offer pay-per-mile insurance, but they also have limited availability. Certain states, like California, don’t even allow pay-per-mile car insurance policies, though some behavior-based plans are available.
The Best Pay-Per-Mile Car Insurance Options
MoneyGeek identified pay-per-mile car insurance policies offered by four insurance companies across multiple states: MetroMile, Nationwide, Liberty Mutual and Allstate. Of these four, we chose Nationwide’s SmartMiles program as our top pick for best pay-per-mile car insurance. This plan is affordable and widely available, and it gives customers opportunities to earn additional discounts for safe driving.
Pay-per-mile car insurance could save you money, but be sure also to evaluate each provider’s financial stability, service quality, claims process and customer satisfaction ratings before choosing a policy.
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Many pay-per-mile insurance policies have limited availability. Below are some of the most popular policies available to drivers, along with their specific features and the states where they’re available:
Pay-Per-Mile Insurance Programs
Insurance Company | Pay-Per-Mile Program Description | Discount | States Available |
|---|---|---|---|
MetroMile | Charges a monthly rate and a rate per mile driven. | None | Eight states: AZ, CA, IL, NJ, OR, PA, VA, WA |
Nationwide | SmartMile program charges a base monthly rate and a per-mile rate. Provides an exception for road trips — only the first 250 miles driven in a day count toward your premium. | Up to 10% for safe driving. | 40 states: AR, AZ, CO, CT, DC, FL, GA, IA, ID, IL, IN, KS, KY, MD, ME, MI, MN, MO, MS, MT, ND, NE, NH, NM, NV, OH, OR, PA, RI, SC, SD, TN, TX, UT, VA, VT, WA, WI, WV, WY |
Allstate | Allstate’s Milewise program charges drivers a daily rate plus a rate per mile driven. | None | 16 states and Washington D.C.: AZ, DE, FL, ID, IL, IN, MA, MD, NJ, OH, OR, PA, TX, VA, WA, WV |
Liberty Mutual | ByMile program tracks the number of miles you drive. You’re billed based on miles driven in the prior month plus a base rate. Never charges drivers for more than 150 miles per day. | None | Available in select states. |
Pay-Per-Mile Car Insurance vs. Behavior-Based Car Insurance
While pay-per-mile car insurance and behavior-based insurance share some similarities, there are some key differences between the two. Pay-per-mile insurance charges you based on miles driven, while behavior-based plans reduce or increase premiums based on your driving performance.
Some of the driving behaviors measured for behavior-based policies include:
- Braking or accelerating quickly
- Using your phone
- Cornering
- Driving on weekends
- Driving at night
- Driving during inclement weather
- Driving speed
- Driving smoothness
Behavior-based plans lower your insurance premiums if you practice safe driving behaviors — like driving smoothly — and may increase your rates if you engage in unsafe driving behaviors.
The Best Behavior-Based Car Insurance Options
Most major insurance companies offer behavior-based car insurance programs, although availability can be limited depending on where you live. Root is the most popular car insurance company whose pricing is based entirely on driving behavior.
Behavior-Based Insurance Programs
Insurance Company | Behavior-Based Program Description | Discount | States Available |
|---|---|---|---|
Root | Behavior-based insurance that measures braking, speed of turns, driving times and route consistency. This company only insures safe drivers. | Varies | 31 states: AZ, AR, CA, CO, CT, DE, GA, IL, IN, IA, KY, LA, MD, MS, MO, MT, NE, NV, NM, ND, OH, OK, OR, PA, SC, TN, TX, UT, VA, WA, WV |
Progressive | Company’s behavior-based insurance — Snapshot — measures how safely you drive and when you drive. | $145, on average | 49 states: AK, AL, AR, AZ, CO, CT, DC, DE, FL, GA, HI, IA, ID, IL, IN, KS, KY, LA, MA, MD, ME, MI, MN, MO, MS, MT, ND, NE, NH, NJ, NM, NV, NY, OH, OK, OR, PA, RI, SC, SD, TN, TX, UT, VA, VT, WA, WI, WV, WY |
GEICO | DriveEasy program penalizes drivers for distracted driving, hard braking and cornering while rewarding policyholders for smooth driving and driving on easy roads. The policy also takes time of day, distance driven, and weather into account. | Varies | 20 states: AZ, CO, CT, FL, IL, IN, KY, LA, MD, NC, NJ, NM, OH, OK, OR, PA, TN, TX, VA, WI |
State Farm | Drive Safe and Save policy measures quick acceleration, hard braking, fast cornering, speeding, distracted driving, miles driven, night driving, and low visibility driving. This program does not penalize drivers for unsafe driving behaviors. | Up to 50% | 47 states: AK, AL, AR, AZ, CO, CT, DC, DE, FL, GA, HI, IA, ID, IL, IN, KS, KY, LA, MD, ME, MI, MN, MO, MS, MT, NC, ND, NE, NH, NJ, NM, NV, OH, OK, OR, PA, SC, SD, TN, TX, UT, VA, VT, WA, WI, WV, WY |
Allstate | Behavior-based insurance — Drivewise — measures speed, braking, and time of day to determine discounts. | 40% or more | 50 states and Washington D.C.: AK, AL, AR, AZ, CA, CO, CT, DC, DE, FL, GA, HI, IA, ID, IL, IN, KS, KY, LA, MA, MD, ME, MI, MN, MO, MS, MT, NC, ND, NE, NH, NJ, NM, NV, NY, OH, OK, OR, PA, RI, SC, SD, TN, TX, UT, VA, VT, WA, WI, WV, WY |
Liberty Mutual | Right Track awards discounts based on miles driven, frequency of nighttime driving, braking and acceleration. The company doesn’t penalize drivers for unsafe driving behaviors. | 5% to 30%, drivers also receive a discount for signing up | 42 states: AL, AR, AZ, CO, CT, DC, DE, FL, GA, IA, ID, IL, IN, KS, KY, LA, MA, MD, ME, MI, MN, MO, MS, NE, NH, NJ, NM, NV, NY, OH, OK, OR, PA, RI, SC, TN, TX, UT, VA, VT, WI, WV |
Farmers | Signal behavior-based insurance measures focused driving, hard brakes, excessive speed, time of day, and total mileage to determine discounts. | 5% discount for signing up and up to 15% for safe driving | 47 states: AK, AL, AR, AZ, CO, CT, DC, DE, FL, GA, IA, ID, IL, IN, KS, KY, LA, MA, MD, ME, MI, MN, MO, MS, MT, NC, ND, NE, NH, NJ, NM, NV, OH, OK, OR, PA, RI, SD, TN, TX, UT, VA, VT, WA, WI, WV, WY |
AAA | SMARTtrek program tracks driving time of day, smoothness, phone habits, speed and mileage to determine discounts. | Up to 10% | Select states |
Esurance | Drivers who enroll in the company’s behavior-based program, DriveSense, get a discount for signing up. Awards another discount based on driving behavior after the first 50 miles and measures speed, hard braking and time of day. | Varies | 35 states: AL, AR, AZ, CO, CT, GA, IA, ID, IL, KS, KY, LA, MD, ME, MI, MN, MO, ND, NE, NJ, NM, NV, OH, OK, OR, PA, RI, SC, SD, TN, TX, UT, VA, WA, WV |
Nationwide | SmartRide records miles driven, hard braking and acceleration, idle time, and nighttime driving. Doesn’t penalize policyholders for unsafe driving. | Up to 10% when you sign up and up to 40% for safe driving | 50 states: AK, AL, AR, AZ, CA, CO, CT, DC, DE, FL, GA, HI, IA, ID, IL, IN, KS, KY, LA, MD, ME, MI, MN, MO, MS, MT, NC, ND, NE, NH, NJ, NM, NV, NY, OH, OK, OR, PA, RI, SC, SD, TN, TX, UT, VA, VT, WA, WI, WV, WY |
USAA | USAA’s SafePilot app gathers information about your location, time of day while driving and whether you're the passenger or driver. It also measures the frequency of phone handling, hand-held calling, hands-free calling or harsh braking. Good drivers can receive a discount. | Up to 10% for signing up and up to 30% for safe driving when you renew your policy | 16 states: AK, AR, AZ, IA, ID, KY, MD, MO, MT, NM, OH, OR, SD, TN, TX, VA |
Travelers | 90-day program — IntelliDrive — monitors the time of day you drive, as well as your speed, acceleration, braking, and distracted driving frequency. Rates increase if you have unsafe driving habits and decrease if you don’t. | 3% to 40% off | 36 states: AL, AR, AZ, CO, CT, DC, FL, GA, IA, ID, IL, IN, KS, KY, MD, ME, MN, MO, MS, MT, NE, NJ, NM, NV, OH, OK, OR, PA, SC, TN, TX, UT, VA, VT, WA, WI |
Frequently Asked Questions About Pay-Per-Mile Car Insurance
Pay-per-mile car insurance is a relatively new product, so drivers often wonder how it works and whether or not it’s worth it. MoneyGeek answered some of the most common questions about pay-per-mile insurance to help you learn more.
When is pay-per-mile car insurance worth it?
Pay-per-mile insurance may be worth it if you drive infrequently. Sample rates provided by MetroMile suggest that people who drive less than 26 miles per week could save money with a pay-per-mile policy.
How do pay-per-mile car insurance calculations work?
Insurance companies calculate costs for pay-per-mile policies using two factors: a base rate and a rate per mile driven. Like they would for a standard insurance policy, your location, age, and past driving history influence these rates.
What is the best pay-per-mile insurance plan?
Nationwide is our top pick for a pay-per-mile insurance policy. The company's SmartMiles program provides coverage to 40 states around the country, making it the most widely available pay-per-mile program MoneyGeek evaluated. SmartMiles also tracks driving behaviors, awarding additional savings to policyholders who drive safely.
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About Margaret Wack
Margaret Wack is a freelance writer who covers insurance, saving, investing, banking and more. Margaret earned a bachelor's degree in classics, comparative literature and poetry from Smith College and a master's degree from St. John's College.