Wouldn’t you love to have a lower auto insurance premium for the same value?  Do you consider yourself to be a safe driver? 

If you answered yes to both of these questions, a usage-based auto insurance program may be a solution for you. 

A new way to lower your auto insurance premium is through usage based insurance programs. 

Telematics Track Your Driving

I’m sure you’re asking, what on earth are usage based insurance programs? 

Usage based insurance is just what it sounds like.  Basically, your insurance will be based on how you drive your car. 

Your behavior is tracked through a telematics device, which is a gadget that is installed in your car to measure your driving activity–how fast you drive, how frequent and far you drive, whether you have sudden stops, if you’re out late at night–you name it, telematics can track it. 

This data is immediately shared with your insurance company. 

If you’re a great driver, all of this will benefit you because it will allow your auto insurance provider to see your A-plus driving skills and give you lower rates because you are less of a risk in their eyes. 

Getting rewarded for good behavior?  Isn’t this the way the world should work? 

Insurance carriers such as Progressive are already offering programs like Progressive Snapshot. 

All you have to do is get the Snapshot device installed, drive for 30 days, and on day 31 your rate is fully personalized, and you can start receiving discounts. 

Pretty cool! 

Is Usage-Based Auto Insurance Right for You? 

According to Forbes, Progressive started offering their telematics program back in 1998, and one-third of overall customers opt-in to participate and of that one-third, two-thirds receive savings. 

Allstate also offers a program called Drivewise, Esurance offers Drivesense and State Farm offers Drive Safe & Save, to name a few. 

Currently, all of the usage-based insurance programs only reward you for your good driving with savings; however, in the future, it is expected that users will also get penalized for poor driving. 

Essentially, If you typically drive well above the speed limit, take risks on the road or drive erratically, telematics is not the best option for you because you won’t receive any savings for your driving behavior. 

It’s important to note that telematics is currently not offered in Alaska, California, Hawaii, Indiana and North Carolina. 

Now that you have the facts on usage based insurance programs, do you trust your driving is good enough to give it a try? 

Wouldn’t saving money on your monthly bill be awesome? 

Plus, usage based insurance encourages safe driving, which is always a good thing! 

This article was written and sponsored by CoverHound, where you can compare car insurance rates in as little as 3 minutes.