Car insurance by the kilometer: is it for you?


To calculate your monthly payment for a pay-per-mile policy, combine the base premium and the cost-per-mile multiplied by the number of miles flown during the previous billing cycle (usually the previous month). The base rate for a pay-per-kilometre auto insurance policy for the same driver can range from $45 to $60 per month. The variable rate can range from $0.06 to $0.07 per mile flown.

In this example, the pay-per-mile policy is approximately 30% cheaper than a traditional policy for that particular month. The break-even point is just over 1,000 miles. A driver who regularly drives more than that under this policy would be better off using a traditional policy. Car insurance companies can now offer more targeted offers and cheaper policiesstyle=”text-decoration: underline”> to meet driver demands.

Who should purchase a per-mile insurance policy?

Kilometer insurance is best for low mileage drivers – those who use public transport, retirees who do not drive oftenstyle=”text-decoration: underline”>, students who do not travel, those who work close to home and those who have additional vehicles. It’s also best for low-mileage vehicles because the variable rate you’ll pay depends on how many miles you’ve driven.

Unlimited car insurance policies are great for high mileage vehicles because you only pay one base rate, no matter how many miles you drive. Other people who can benefit from a pay-per-mile insurance policy are weekend drivers, city commuters, and drivers with rental cars. Rental cars usually have a maximum number of miles you can drive.

Pay per kilometer is also for people who want greater transparency and control over their insurance costs. According to Kelly Hernandez, Associate Vice President of Personal Lines Telematics at Nationwide, more consumers are taking advantage of “usage-based capabilities and saving money by having more price control over their insurance protection.” .

Is a per-mile car insurance policy worth it?

Many drivers have permanently changed their driving behavior due to the pandemic, especially those working from home and using their vehicles less. A pay-per-mile car insurance policy is worth it if you only drive a few miles a month.

After get your quotestyle=”text-decoration: underline”> from the insurance company, compare the base rate and variable rate based on distance traveled with the cost of a traditional policy. If your monthly premium is lower than a regular policy, a pay-per-mile car insurance policy may be worth it. It is important to take into account if you plan to take long car journeys at certain times of the year. Some insurers will cap the number of miles, ranging from 150 to 250 miles, you pay each day for a covered vehicle if you’re on a long trip.

READ MORE: Compare auto insurance rates in 2022style=”text decoration: underline”>

With the rapid adoption of telematics by insurers and drivers, drivers can customize auto insurance coverage based on the number of miles they drive. People who don’t drive a lot may be paying too much for car insurance. Usage-based policies may soon become the norm.

The best paying car insurance companies

Nationwide SmartMiles

SmartMiles offers the same flexibility and coverage selections as traditional auto insurance policies. But with SmartMiles, you could pay less because your monthly payment is based on the number of miles flown. Most vehicles manufactured after 1996 are eligible for SmartMiles. Some hybrid and diesel cars may be incompatible with the device. SmartMiles is available in all states with the exception of

  • Alaska
  • California
  • Hawaii
  • Louisiana
  • Massachusetts
  • North Carolina
  • New York
  • Oklahoma

Allstate Milewise

Milewise offers the same coverage and claims service as a regular Allstate policy, but is based on miles driven. The Allstate app gives you quick access to your Milewise policy details, account balance, miles driven and safe driving status. You can review your weekly travel and spending to set goals. You can also explore detailed maps to get personalized driving commentary. Milewise is only available in 20 states.


Metromile says its pay-per-kilometre insurance saves an average of 47% compared to what a customer paid to their previous auto insurer. Its monthly base rate starts at $29. All miles over 250 per day are free (150 for New Jersey drivers), so you won’t have to worry about going over your miles. It offers flexible coverage options that you can customize to meet your needs. Its app lets you view your trips, understand your car’s status, avoid tickets with street scan alerts (only available in select cities), and find your lost or stolen car. Metromile is only available in

  • Washington
  • California
  • Oregon
  • Illinois
  • Arizona
  • Virginia
  • Pennsylvania
  • New Jersey

Auto mileage

Mile Auto offers pay-per-kilometre car insurance without installing a “black box” that tracks all aspects of your car and your habits in your car, to provide greater privacy. It says Mile customers can save 30-40% on its standard insurance rates. It requires you to send a photo of your odometer once a month. Its MVerity system will send you a series of monthly text and email reminders when it’s time to submit your odometer reading. Every text and email will have a hyperlink that you click on to automatically open the camera in your smartphone. MVerity extracts your odometer data, confirms the vehicle and authenticity of the photo, then compares it to previous odometer readings. Mile Auto offers “full coverage” car insurance and is currently available in

  • Arizona
  • California
  • Georgia
  • Illinois
  • Ohio
  • Oregon
  • Pennsylvania
  • Texas

Liberty Mutual ByMile

ByMile requires you to plug a device into your vehicle’s On-Board Diagnostics (OBD-II) port. Your premium is personalized based on the number of verified miles you’ve flown in previous months, allowing you to pay only for the insurance you need. ByMile also gives you access to an app that lets you view your journeys and track your miles. ByMile is only available in certain states, so you will need to find a local agent. Drivers who have Liberty can opt-in or opt-out by contacting their agent or the ByMile Service Team.


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