Car Insurance Latest News
Pay as you go - for car insurance?
Car insurance for the British market has now taken a new turn. Norwich Union
has introduced the first car insurance scheme based on vehicle usage. This
is a new idea for insurance policies but pay-as-you-go has been around for
years from the telecom industry.
The scheme has been introduced after Norwich Union extensively tested the
concept with 5,000 drivers dating back to 2004.
So how much is the Cover?
The cost, somewhat like traditional policies, will be based on where the
car is based, how far the journey is and how often it is driven. To enable
Norwich Union to track the use of the insured vehicle it will be fitted
with a GPS system, a 'black box' to track all the vehicle movements. The
system automatically picks up all the data via satellite and works out the
cost on a journey to journey basis. The type of road will also make a difference
to the level of charges made.
Initial Costs look like this:
- Motorway driving - from 1p per mile off-peak (up to 10 times safer than driving on low-speed urban roads)
- Urban driving - from 4p per mile for off-peak
- Journeys made between 11pm and 6am - £1.00 per mile (for 18 - 23 year olds)
- Off Peak Journey - from 5p per mile (for 18 - 23 year olds)
A lower premium will be offered to drivers aged 18 to 23 if they refrain from driving after dusk. There will also be a tariff of kinds where by younger drivers will also get one hundred or more "free" off-peak miles per month... continued...
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