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Environmental Defense Using Auto Insurance

The changing consumer needs have been what many auto insurance companies have looked for ways to respond to over the years. Consumers all across the country are looking desperately for some way to save some money on auto fuel as gas prices are soaring. Our finances are now tightly bound by many consumer goods, and among them is the soaring price of gasoline and the costs involved with paying auto insurance. Insurance companies have responded by creating a new insurance program known as a pay as you drive program that could provide policy holders some financial relief.

The program is officially called Environmental Defense and the purpose of the program is to track an individual's car mileage. Two ways are proposed to make this work. One method is done by installing a proprietary odometer that contains an embedded cell phone that periodically calls in your mileage to your insurance company.

The other often used method of tracking mileage, is a GPS device installed in a phone in your car to track the travel route you are taking, much like the On Star system does. You may need some more information to help you decide which of these methods may work for you.

Some consumers object to the GPS system, because they feel that it imposes on their right to privacy. The GPS device has certain advantages over the propriety odometer method of tracking mileage because it not only keeps the mileage count, it also pinpoints your time and route of travel. So you need to weigh your privacy concerns against the potential benefits.

Since the insurance companies will be offering a financial incentive for driving less, the Environmental Defense thinks that a pay as you drive program will eventually save the consumers money as well as helping to reduce pollution. An added benefit of the pay as you drive program is that it could end up reducing driving and congestion in cities where traffic problems with overcrowded highways are mounting.

Pay as you drive programs could make auto insurance more affordable for drivers by giving them some control over their auto insurance premiums.

You can easily determine how cost effective a pay as you drive program can be for you. The pay as you drive program would charge part of your annual premium rate into a per mile fee by your car being assigned to a group in accordance with your vehicle type and usage plus your zip code. When a per mile rate is determined, you may be responsible for paying an upfront fee for your pre-determined mileage. The amount you will have to pay on auto insurance and whether you will receive a rebate or have to pay more, will be determined by the amount of time you spend driving the car.

It is estimated that this type of program could end up saving some policy holders up to 25 percent on their auto insurance.

If you can actually save money on the cost of auto insurance and improve the environment and cut down on the amount of congested highways, it could be the best way to go.

Article Source: http://www.articles2know.com

Alisdair Cosgrove has been writing personal finance articles for many years and can find more of his work at the UK site TheMoneyStop.co.uk, offering best car insurance and other insurance products including {{{home insurance quotes|compare travel insurance|great life insurance cover. There is also many informative insurance articles including Getting a great deal on insurance

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