Usage-based insurance (UBI) programs use telematic devices or apps to track driving habits, including miles driven, speed and acceleration patterns, and handheld-device usage.
Good drivers might become eligible for a discount through some UBI programs, but it’s important to note that poor driving habits, such as speeding or driving while using your smartphone, can result in increased rates with some programs.
Before you enroll in a UBI plan, ask the insurer if your driving habits can lead to a premium increase. Some insurers, like Nationwide and USAA, offer UBI programs that don’t increase rates if your driving scores poorly, so there’s less risk of trying out the program.
Another option might be pay-per-mile insurance, which bases rates on the number of miles you drive in a month. If you drive infrequently, a pay-per-mile plan might result in lower car insurance rates.
