what is Usage Based insurance?
With inflation and rising rates of gas as well as many other standards of living many people are looking for ways in which they can cut down on costs. While Insurance isn’t the best thing to skimp out on, there’s many ways in which you can save and get rewarded for participating in certain programs for discounts. This is where Usage based Insurance (UBI) comes in.
This article will give you a detailed outline of UBI and if it’s a good fit for you.
- What is Usage based insurance?
- How does Usage Based Insurance Work?
- Is UBI right for you?
What is Usage Based Insurance (UBI)
Usage based insurance or (UBI) is a type of insurance program that rewards customers based on the safe driving behaviors they display. The insurance company uses data from a device installed in the customer’s car or participating in an app to track their driving habits.
UBI discounts are determined by how much and how far a vehicle is driven as well as other driving behaviors. Discounts range from company to company but it’s all based on the actual driving patterns of the insured.
How does Usage Based Insurance Work?
Usage-based insurance programs track how you drive using automobile telematics data that comes from cellular, GPS or other technology. This data can include certain behaviors such as:
- Acceleration,
- Hard braking,
- Miles driven,
- Idle Time
- Nighttime driving
How your driving habits affect your car insurance premium will depend on your insurer, but in a typical UBI plan, you’re tracked over a certain period of time. Once this collection period is complete, you can be offered a discount based on telematics data based on the behaviors displayed.
Is UBI right for you?
Safe drivers usually save money on usage-based insurance plans that reward them for not driving very often or display safe driving habits. Safe motorists are less likely to be involved in accidents, and their monthly premiums reflect that fact. These types of savings can benefit certain demographics which are made up of students who use a car for weekend outings, retirees who want to save on gas, stay-at-home parents who spend most of the day at home with children and don’t need a car to get around or individuals who work from home or take public transit to work and don’t need their own vehicles. The question you’ve got to ask yourself is, Is that you?
If you’re looking for more info on how you can earn these discounts contact us today for your free evaluation and get a quote
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