Is Pay-Per-Mile Insurance Worth It?

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If you're looking for a less expensive car insurance option, Metromile has an intriguing idea. Its fees are basically determined by how much you drive.

Metromile, based in San Francisco, sells automobile insurance to those who prefer to pay by the mile. It is currently available in eight states: Arizona, California, Illinois, New Jersey, Oregon, Pennsylvania, Virginia, and Washington as of August 2019.

People that drive relatively little are the company's target market. If you travel less than 10,000 miles per year, you may save hundreds of dollars on vehicle insurance each year.

What Does a Metromile Entail?

Metromile offers all of the features that most carriers do. It provides coverage for personal injury and property damage, as well as coverage for uninsured or underinsured motorists. It has the standard collision and comprehensive deductions from from $250 to $1,000.

You also get roadside assistance and claim support 24 hours a day, 7 days a week.

TAKEAWAYS IMPORTANT

• Metromile is a type of alternative automobile insurance in which costs are based mostly on mileage.
• Metromile tracks miles driven using a monitor that connects into a car's diagnostic port.
• A driver's eligibility for Metromile insurance is determined by traditional characteristics such as age, credit history, and driving history.
• Aside from the driver's qualifications, the vehicle must have an OBD-II port.

Understanding Metromile

A flat monthly fee plus a mileage fee is charged by Metromile insurance. For example, you could pay $40 per month + 5 cents every mile. You would spend $65 per month or $780 per year if you drove 500 miles per month. As with typical insurers, the rate varies depending on your driving record, age and where you live.

The mileage rule does have several exceptions. To begin, Metromile will only charge you for up to 250 miles per day in New Jersey, or 150 miles per day in other states. That means an occasional road trip won't break the wallet, but a cross-country excursion will rack up a substantial bill.

Uber and Lyft are not covered.

Metromile recently ended its connection with Uber, and it also does not cover other ride-sharing services such as Lyft. It has worked with Turo to provide fractional insurance, which protects drivers from being taxed twice or insured twice. Customers who have both a Metromile and a Turo account will only be charged the per-mile fee if their car is not shared with someone else through Turo. When someone else drives the Metromile customer's car, Turo's insurance kicks in.

Metromile has no way of knowing how many miles you drove. It works with Metromile Pulse, a device that connects to your car's diagnostic port, the same one that your technician uses to identify problems. Pulse then sends a slew of information to Metromile, which you can view in the app or on the web. This includes not only mileage but also your vehicle's condition and location. If you need to move your car off the street, Pulse has an alert system that will notify you. Street-cleaning notifications are the name for these messages. Pulse adapters are also available from Metromile for clients who may be driving an older vehicle or a Tesla.

Who is eligible to participate?

When it comes to eligibility, Metromile insurance works similarly to any other carrier. Your base and per-mile rates are determined by your driving history, age, credit score, and other variables. That means there could be significant price discrepancies between you and your neighbor.

In addition, your car must have an OBD-II port. You almost certainly have one if your car isn't more than 20 years old.

Final Thoughts

The concept is appealing, and it may be feasible if you drive infrequently. A cursory, non-scientific examination of the company's reviews revealed a mixed bag. Many reviews state that the claims experience was less than ideal, and that the price increased after six months, to the point where regular insurance became cheaper.