Working From Home? Pay-Per-Mile Car Insurance May Be for You

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  • With pay-per-mile auto insurance, your costs hinge on how much you drive your vehicle.
  • This option could be cost-effective if you drive pretty infrequently.

It's an option that could save you a lot of money.

Remote work used to be a privilege only a small percentage of employees benefited from. But then the pandemic hit, and for better or worse, it changed the commuting landscape on what's probably a long-term basis.

As of 2022, an estimated 26% of U.S. workers were doing their jobs remotely, according to Zippia. And there are numerous benefits to being able to work from home, like having an easier time juggling household responsibilities and potentially saving on childcare costs.

Working from home might also mean you don't drive your car as frequently as you once did. But if that's the case, one thing you don't want to do is overpay for auto insurance. And that's why it could pay to see if your car insurance company offers a pay-per-mile option.

How pay-per-mile auto insurance works

With pay-per-mile auto insurance, your costs are determined based on your actual mileage. The upside of pay-per-mile auto insurance is that you might end up saving money if you don't do a lot of driving.

See, the more you drive, the more likely you are to get into an accident. That's something auto insurers take into account when establishing premium rates. But if you don't drive very often, your insurance company takes on less risk. And in exchange, it may be willing to reward you with lower-cost insurance, which pay-per-mile plans tend to be.

How your mileage is measured

For pay-per-mile auto insurance programs to work, your insurer needs a way to track your mileage. This can generally be done in one of two ways.

You may be given a device that plugs into your vehicle that tracks your mileage as you go. If you find this option too invasive, you may be able to instead work out an arrangement where you take a picture of your odometer every month to prove how far you've driven. You may also need to revert to this option if you have an older vehicle.

Is pay-per-mile auto insurance really going to save you money?

The quick answer is that it depends. To see if this option makes sense, you'll want to reach out to different auto insurers and see if you can get a per-mile quote. You can then do your best to estimate your mileage for a year and compare the cost of pay-per-mile auto insurance to the cost of a standard policy.

Should you sign up for pay-per-mile auto insurance if you work from home?

Just because you work from home doesn't mean you don't do a lot of driving. Maybe your job is remote, but two of your kids play on a travel soccer team that has you driving all over the state several times a week. But if you don't do a lot of driving in general, then it could pay to look into one of these plans.

Incidentally, pay-per-mile auto insurance could also make sense if you commute to work but don't drive very far. It might be a similarly cost-effective option if you're retired and don't use your car very often.

Either way, it certainly doesn't hurt to explore your options and crunch the numbers. And who knows? You may find that you're able to reduce the cost of car ownership by changing your auto insurance policy.

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