Progressive, the second largest auto insurer in Florida, has announced their new program that will provide discounts to drivers that spend less time on the road. To be eligible for the coverage, drivers must allow the insurer to track how much they drive. This usage based insurance is designed to encourage people to drive less, lowing greenhouse emissions, and also to provide more accurate pricing on auto policies.
The plan will specifically benefit travelers who leave their cars parked at airports for several days, families with additional, less used vehicles, and those that have opted to use public transit to be more eco-friendly. The company stated today that these people are “all less likely to be in an accident and can save money on their car insurance.”
Richard Hutchinson, General Manager of usage-based insurance for Progressive, has said that this program will allow the insurer to more accurately price policies based on actual data instead of reported driving habits. The pay-as-you-go plan is the first such plan to be instituted by a big name insurer in the nation.
The company will provide a device that tracks how users drive and how often they do so. After 30 days, the customer returns the device to see if they are eligible for the policy. Discounts for those eligible can be as high as 30%.
Participation in the plan is entirely voluntary – Progressive will continue to insure those unwilling to partake in the efforts necessary and will not be subject to rises in premiums.