Car Insurance – The Policy of Pay As You Drive

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Are you hearing the words “pay as you drive” for the first time? Never mind, it is very simple to understand. The concept behind it is easy and simple. Just as the wordings, “pay as you drive auto insurance” is exactly what the name implies. It simply refers to paying as you drive your car. The question however is; how many people will pay as you drive auto insurance benefit even though it seems appealing and attractive?

It is based on the premise that if you do not drive much, you will not pay high insurance premiums. One of the advantages amongst all others, associated with this kind of insurance policy according to it’s proponents is a general reduction in costs.

Why pay high insurance premiums when you didn’t use your car for a good number of time, or you actually use it less often. With this policy, you pay only as you use your car. In other words, you are only making payments as you go.

With a pay as you drive auto insurance policy, what insurance companies does is to attach some cents that you pay according to some per mile driving plan or schedule. Consequently, the insurance company covers you only for a particular period according to the amount of miles that you bought

Generally speaking, pay as you drive auto insurance policy is a way of bringing down overhead costs especially for folks that don’t use their cars very often. It is a cost and an environment saving technique.

Moreover, it is important to state here that certain insurance organizations such as General Motors, gives room for pay as you drive rates. Few years back for example, they started offering mileage discounts to their clients situated in certain regions.

Conclusively, the concept and policy of pay as you drive is now spreading like wild fire. It is presently being practiced in countries like Holland, Israel, and South Africa, just to mention a few.

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