Is it time you considered ‘Pay-As-You-Drive’ car insurance?
24 Mar 2020
As the nation continues to take each day as it comes during the coronavirus outbreak, many Aussies may have already had to say goodbye to their daily commute.
But while having the chance to save on petrol is one small perk of working from home, there may be another benefit many Aussies drivers may not have looked into that could help them save further: Pay-As-You-Drive car insurance.
Pay-As-You-Drive car insurance allows drivers who don’t use their car often to take out comprehensive car insurance at a lower premium.
A handful of car insurance providers offering Pay-As-You-Drive car insurance including Woolworths, Kogan and Real Insurance.
“Australia is enduring some of its toughest times at the moment, with many Aussies becoming unemployed or being forced to take annual leave, so it makes sense to want to reduce costs wherever possible,” said Mozo Director, Kirsty Lamont.
“While it’s not for everyone, Pay-As-You-Drive car insurance could help reduce your premium if you are now driving below the average kilometer amount.”
How can I take out Pay-As-You-Drive car insurance?
Like you would with a regular comprehensive car insurance policy, you should gather at least three quotes to make sure you’re getting a good deal.
When shopping around, you’ll need to provide the amount of kilometres you plan on driving and the odometer reading of your car.
Once you've signed up, you’ll be given a kilometer limit based on the details of your driving range - you do have the option to ‘top up’ your kilometer limit, but you may need to pay extra.
Any unused kilometres can also be transferred onto your next policy or be credited to your account.
Are there any cons to a Pay-As-You-Drive car insurance policy?
While the sound of a lower premium may be music to the ears of most drivers, opting for a Pay-As-You-Drive car insurance policy does come with its drawbacks.
Since these policies are based on a kilometer limit, if you were to get into an accident and were over your designated limit, you would be charged an additional excess for any claims made.
And of course, you will need to regularly monitor the number of kilometers you’ve driven to make sure you’re within your permitted limit.
Thinking a Pay-As-You-Drive car insurance policy could be right for you? Head on over to our car insurance comparison tool to find out where you can make the switch.
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