Cheap Car Insurance if You Drive Less Than 50 Miles a Day

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If you drive less than 50 miles a day, you could qualify for cheap car insurance. (Photo: @chibelek via Twenty20)
People who drive less than 50 miles a day have an advantage when it comes to finding cheap insurance. After all, the risk of accidents drops proportionately with the number of miles driven. Here’s what you need to know about cheap car insurance for low-mileage drivers.

Low-Mileage Car Insurance Discounts

While car insurance providers may have different definitions of “low mileage,” many companies offer discounts to drivers with 7,500 to 15,000 in annual miles. However, most car insurance providers will not simply take your word for it when trying to determine how much you drive.
You may have to install a tracking device or software that logs mileage and driving habits to prove eligibility, which can come with an installation or monthly fee in addition to your premium.
This discount may also apply if certain lifestyle changes have taken place. Recent retirees, people who have relocated to a closer place of employment, and those who have begun telecommuting or carpooling usually experience a drop in miles and become eligible for a low-mileage car insurance discount. A person could also become eligible for savings after buying a second car and sharing mileage between two vehicles.

Usage-Based Car Insurance

Usage-based car insurance has a pay-per-mile approach, and eligibility for this type of coverage also requires some proof of driving habits. Most companies offering this form of insurance require drivers to install a telematic device in their car — a device that keeps track of mileage, times of day the car is driven, average length of trips, and even how hard a driver depresses the brakes. While this device reveals a lot of personal information, it can result in up to 50% savings on car insurance.
Some car insurance companies offer a discount to drivers who simply use the telematic device. This is because companies project lower accident risk for policyholders who are knowingly having their driving habits monitored. Usage-based car insurance employing telematic devices may also benefit the parents of young drivers because it helps to monitor teen driving habits.
Keep in mind that not all states offer low-mileage discounts or usage-based car insurance, and there are often requirements that vehicles must meet for eligibility. But if you don’t drive very far, it’s definitely worth looking into an insurance policy that rewards your kind of driving.