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Pay-as-you-drive Insurance Plans

To get the benefits of a pay-as-you-drive discount, your car must be:
  • A 1996 or later model equipped with an onboard diagnostics (OBDII) port that accepts a telematics device plug-in. You will find the port underneath the dashboard near your steering wheel. Plug-in devices typically gather information such as mileage, speed, time of day and braking events.
  • Equipped with an onboard telematics systems such as OnStar or Sync, which typically report mileage only.

Here is a sampling of discount programs offered by major insurers. (See " Your guide to car insurance discounts" for an overview of all common major price discounts.)

Progressive's Snapshot: The way Snapshot works is typical -- you plug in the device, which then tracks time of day you drive, how far, how fast and how often you brake hard. Richard Hutchinson, the company's general manager of usage-based insurance, says savings could reach 30 percent for the most conscientious motorists. He adds that it's best if your car stays parked during peak accident hours (between midnight and 4 a.m.). The device must be installed for at least 30 days to generate a driving profile. Snapshot can  now be   tried for 30 days without being a Progressive customer. Most states offer Snapshot; those that don't are Alaska, California, Hawaii, Illinois, Indiana, North Carolina, Tennessee and Washington.

State Farm's Drive Safe & Save and In-Drive: You need an OnStar or SYNC subscription for Drive Safe & Save. OnStar is already in more than 30 GM models, but you can pay to have it added to your car. SYNC is an option on most Ford models. State Farm receives odometer readings from OnStar or SYNC every 30 days after you enroll and, after six months, adjusts your premium to reflect the mileage. The company says discounts usually range from 10 to 50 percent depending on mileage, when you drive and how safely you drive. The insurer also offers In-Drive, which uses an OBDII plug-in to track time of day and vehicle speed, how many miles driven and how often you brake hard. State Farm spokesperson Missy Lundberg says you immediately receive about a 10 percent discount on premiums through In-Drive. She adds that another 20 percent might be saved if you stay below 12,000 miles a year, the national average.

Allstate's Drive Wise: You can get Drive Wise only in Arizona, Colorado, Illinois, Michigan, New York and Ohio, but Allstate says it plans to expand the program. A plug-in device records the usual motoring statistics, which are used to determine if customers qualify for a 10 percent discount for the first policy term. If drivers maintain safe motoring habits and low mileage during subsequent terms, savings can reach 30 percent, according to the company.

The Hartford's TrueLane: This is offered in Connecticut, Minnesota, Missouri, Oregon and West Virginia, with plans for expansion. A plug-in device records relevant motoring information and transmits it to the insurer by its partner, Octo USA, over that firm's cellular network. TrueLane customers get a 5 percent discount by enrolling. After driving for 75 days, your premium could drop by as much as 25 percent, depending on how safely you drive.

Travelers' IntelliDrive: You can receive an immediate discount of up to 5 percent by installing this plug-in device. IntelliDrive, which is so far available in Alabama, Illinois, Indiana, Maine, Ohio, Oregon and Virginia, can reduce premiums by as much as 20 percent for the best drivers, according to Travelers.

Esurance's DriveSense: Another plug-in offering, currently only available in Arkansas and Texas. Details gathered from the DriveSense device are transmitted through Sprint's wireless network to Esurance, which determines if drivers qualify for discounts up to 30 percent.

Safeco's Rewind: The company, which is owned by Liberty Mutual, offers a PAYD program for motorists who are paying higher insurance rates because of traffic tickets or accidents. A plug-in device monitors their driving and keeps a record of the usual details. After four months, the record is evaluated by Safeco, which may reduce or eliminate the premium increases that came because of the prior accidents or violations. Rewind is not available in every state, so check with an agent.

GMAC Insurance's Low Mileage Discount: The company offers two paths to a discount. Its plug-in monitors much the same data as others do -- speed, braking, mileage and when a vehicle is driven. GMAC also offers the option of reporting mileage though OnStar. The rate cuts range from 13 percent for those who drive 15,000 miles a year to 50 percent for those who drive less than 2,500. The Low-Mileage Discount program is offered, so far, in 35 states.

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