Is Pay-Per-Mile Car Insurance Worth It? The Best Options

Name: Is Pay-Per-Mile Car Insurance Worth It? The Best Options
Item: Is Pay-Per-Mile Car Insurance Worth It? The Best Options
Author: Mark Fitzpatrick

Pay-per-mile auto insurance charges drivers a monthly premium based on how much they drive. MoneyGeek found that people who drive less than 26 miles per week could see significant savings with a pay-per-mile policy.

By Mark Fitzpatrick

Reviewed by Mark Fitzpatrick

Updated: August 20, 2024

Advertising & Editorial Disclosure

Pay-per-mile car insurance adjusts your premium based on the number of miles you drive. MetroMile is the most well-known car provider that exclusively offers pay-per-mile insurance. Major names, like Nationwide and Allstate, are also beginning to provide pay-per-mile policies across the country.

This insurance model shouldn’t be confused with behavior-based insurance, which measures not only how much you drive but the quality of your driving. Root is the most notable behavior-based car insurance company, but traditional Insurers are expanding these programs too.

Pay-per-mile and behavior-based insurance may be unique coverage options, but are they right for you? MoneyGeek helps you explore your options so you can find the best auto insurance policy for your needs.

What Is Pay-Per-Mile Car Insurance?
How Pay-Per-Mile Insurance Works
Best Pay-Per-Mile Insurance
Behavior-Based Car Insurance
FAQs About Pay-Per-Mile Insurance

Why Trust MoneyGeek? MoneyGeek helps consumers compare car insurance quotes to illustrate the importance of exploring your options when looking for a policy. The cost of car insurance varies based on your location, driver profile and the coverage levels you prefer. To help you find the best option for you, MoneyGeek gathered thousands of quotes from several companies in different ZIP codes.

83,056Quotes Analyzed

46Companies Compared

473Zip Codes

What Is Pay-Per-Mile Car Insurance?

Pay-per-mile is a type of auto insurance policy best suited for low mileage drivers. Instead of charging a flat monthly rate based solely on factors like driving history, age and location, pay-per-mile policies also factor in how much you drive. These policies typically add a cost-per-mile to your base insurance rate, charging you a few cents for every mile you drive.

MetroMile specializes in pay-per-mile insurance policies. Other popular insurers — like Allstate, Liberty Mutual and Nationwide — offer pay-per-mile programs in select states. Note that pay-per-mile programs aren’t the same as behavior-based insurance, which tracks not just how much you drive but how safely you drive.

How Does Pay-Per-Mile Car Insurance Work? Should You Get It?

According to MoneyGeek’s research, pay-per-mile car insurance is only the cheapest auto insurance policy for people who drive infrequently. Here’s how pay-per-mile insurance plans typically function:

An insurer calculates your base rate and rate per mile.
Base rates and per-mile rates depend on your age, location, driving history and insurer.
Say an insurer may offer you a base rate of $60 per month and 10 cents per mile driven. If you drive 1,200 miles per month (about 40 miles per day), you’ll pay $120 per month for the miles you drive and $60 for your base rate, or $180 per month.

Should You Get Pay-Per-Mile Car Insurance?

There’s no way to know with certainty that pay-per-mile car insurance will save you money until you get a quote. However, rates from the leading pay-per-mile provider — MetroMile — suggest that a typical driver would have to drive less than 26 miles per week to save money with a pay-per-mile plan.

To help give you an idea of how much you might pay with pay-per-mile insurance, MoneyGeek obtained quotes from MetroMile in Illinois for a typical car insurance policy. We found that MetroMile charged our sample driver a base rate of $57 per month and 8 cents per mile. On average, MetroMile charges drivers who drive less than 26 miles per week $65 a month for insurance. The same coverage with GEICO costs about $66, while AAA charges $139.

Pay-Per-Mile Car Insurance Rates

	Insurer	Monthly Rate
1.	Metromile (26 miles per week)	$65
2.	GEICO	$66
3.	Mercury	$72
4.	Country Financial	$72
5.	USAA	$73
6.	State Farm	$79
7.	Metromile (65 miles per week)	$80
8.	Erie	$84
9.	Progressive	$85
10.	American Family	$90
11.	Travelers	$94
12.	Allstate	$98
13.	Metromile (130 miles per week)	$103
14.	Farmers	$111
15.	MetLife	$116
16.	Nationwide	$123
17.	AAA	$139
18.	Metromile (260 miles per week)	$149

If you’re interested in pay-per-mile insurance, note that you may have trouble finding a policy. MetroMile is available in just eight states. Only three of the biggest insurers in the country offer pay-per-mile insurance, but they also have limited availability. Certain states, like California, don’t even allow pay-per-mile car insurance policies, though some behavior-based plans are available.

The Best Pay-Per-Mile Car Insurance Options

MoneyGeek identified pay-per-mile car insurance policies offered by four insurance companies across multiple states: MetroMile, Nationwide, Liberty Mutual and Allstate. Of these four, we chose Nationwide’s SmartMiles program as our top pick for best pay-per-mile car insurance. This plan is affordable and widely available, and it gives customers opportunities to earn additional discounts for safe driving.

Pay-per-mile car insurance could save you money, but be sure also to evaluate each provider’s financial stability, service quality, claims process and customer satisfaction ratings before choosing a policy.

Nationwide

Nationwide is our top pick for pay-per-mile car insurance for several reasons. Drivers can purchase the plan in 40 states, making it the most widely available pay-per-mile policy. It also gives drivers even more opportunities to save, with up to a 10% discount for safe driving. Plus, if you don’t drive much but occasionally go on long road trips, Nationwide only charges you for the first 250 miles driven on any given day.

Many pay-per-mile insurance policies have limited availability. Below are some of the most popular policies available to drivers, along with their specific features and the states where they’re available:

Pay-Per-Mile Insurance Programs

Insurance Company	Pay-Per-Mile Program Description	Discount	States Available
MetroMile	Charges a monthly rate and a rate per mile driven.	None	Eight states: AZ, CA, IL, NJ, OR, PA, VA, WA
Nationwide	SmartMile program charges a base monthly rate and a per-mile rate. Provides an exception for road trips — only the first 250 miles driven in a day count toward your premium.	Up to 10% for safe driving.	40 states: AR, AZ, CO, CT, DC, FL, GA, IA, ID, IL, IN, KS, KY, MD, ME, MI, MN, MO, MS, MT, ND, NE, NH, NM, NV, OH, OR, PA, RI, SC, SD, TN, TX, UT, VA, VT, WA, WI, WV, WY
Allstate	Allstate’s Milewise program charges drivers a daily rate plus a rate per mile driven.	None	16 states and Washington D.C.: AZ, DE, FL, ID, IL, IN, MA, MD, NJ, OH, OR, PA, TX, VA, WA, WV
Liberty Mutual	ByMile program tracks the number of miles you drive. You’re billed based on miles driven in the prior month plus a base rate. Never charges drivers for more than 150 miles per day.	None	Available in select states.

Pay-Per-Mile Car Insurance vs. Behavior-Based Car Insurance

While pay-per-mile car insurance and behavior-based insurance share some similarities, there are some key differences between the two. Pay-per-mile insurance charges you based on miles driven, while behavior-based plans reduce or increase premiums based on your driving performance.

Some of the driving behaviors measured for behavior-based policies include:

Braking or accelerating quickly
Using your phone
Cornering
Driving on weekends
Driving at night
Driving during inclement weather
Driving speed
Driving smoothness

Behavior-based plans lower your insurance premiums if you practice safe driving behaviors — like driving smoothly — and may increase your rates if you engage in unsafe driving behaviors.

The Best Behavior-Based Car Insurance Options

Most major insurance companies offer behavior-based car insurance programs, although availability can be limited depending on where you live. Root is the most popular car insurance company whose pricing is based entirely on driving behavior.

Behavior-Based Insurance Programs

Insurance Company	Behavior-Based Program Description	Discount	States Available
Root	Behavior-based insurance that measures braking, speed of turns, driving times and route consistency. This company only insures safe drivers.	Varies	31 states: AZ, AR, CA, CO, CT, DE, GA, IL, IN, IA, KY, LA, MD, MS, MO, MT, NE, NV, NM, ND, OH, OK, OR, PA, SC, TN, TX, UT, VA, WA, WV
Progressive	Company’s behavior-based insurance — Snapshot — measures how safely you drive and when you drive.	$145, on average	49 states: AK, AL, AR, AZ, CO, CT, DC, DE, FL, GA, HI, IA, ID, IL, IN, KS, KY, LA, MA, MD, ME, MI, MN, MO, MS, MT, ND, NE, NH, NJ, NM, NV, NY, OH, OK, OR, PA, RI, SC, SD, TN, TX, UT, VA, VT, WA, WI, WV, WY
GEICO	DriveEasy program penalizes drivers for distracted driving, hard braking and cornering while rewarding policyholders for smooth driving and driving on easy roads. The policy also takes time of day, distance driven, and weather into account.	Varies	20 states: AZ, CO, CT, FL, IL, IN, KY, LA, MD, NC, NJ, NM, OH, OK, OR, PA, TN, TX, VA, WI
State Farm	Drive Safe and Save policy measures quick acceleration, hard braking, fast cornering, speeding, distracted driving, miles driven, night driving, and low visibility driving. This program does not penalize drivers for unsafe driving behaviors.	Up to 50%	47 states: AK, AL, AR, AZ, CO, CT, DC, DE, FL, GA, HI, IA, ID, IL, IN, KS, KY, LA, MD, ME, MI, MN, MO, MS, MT, NC, ND, NE, NH, NJ, NM, NV, OH, OK, OR, PA, SC, SD, TN, TX, UT, VA, VT, WA, WI, WV, WY
Allstate	Behavior-based insurance — Drivewise — measures speed, braking, and time of day to determine discounts.	40% or more	50 states and Washington D.C.: AK, AL, AR, AZ, CA, CO, CT, DC, DE, FL, GA, HI, IA, ID, IL, IN, KS, KY, LA, MA, MD, ME, MI, MN, MO, MS, MT, NC, ND, NE, NH, NJ, NM, NV, NY, OH, OK, OR, PA, RI, SC, SD, TN, TX, UT, VA, VT, WA, WI, WV, WY
Liberty Mutual	Right Track awards discounts based on miles driven, frequency of nighttime driving, braking and acceleration. The company doesn’t penalize drivers for unsafe driving behaviors.	5% to 30%, drivers also receive a discount for signing up	42 states: AL, AR, AZ, CO, CT, DC, DE, FL, GA, IA, ID, IL, IN, KS, KY, LA, MA, MD, ME, MI, MN, MO, MS, NE, NH, NJ, NM, NV, NY, OH, OK, OR, PA, RI, SC, TN, TX, UT, VA, VT, WI, WV
Farmers	Signal behavior-based insurance measures focused driving, hard brakes, excessive speed, time of day, and total mileage to determine discounts.	5% discount for signing up and up to 15% for safe driving	47 states: AK, AL, AR, AZ, CO, CT, DC, DE, FL, GA, IA, ID, IL, IN, KS, KY, LA, MA, MD, ME, MI, MN, MO, MS, MT, NC, ND, NE, NH, NJ, NM, NV, OH, OK, OR, PA, RI, SD, TN, TX, UT, VA, VT, WA, WI, WV, WY
AAA	SMARTtrek program tracks driving time of day, smoothness, phone habits, speed and mileage to determine discounts.	Up to 10%	Select states
Esurance	Drivers who enroll in the company’s behavior-based program, DriveSense, get a discount for signing up. Awards another discount based on driving behavior after the first 50 miles and measures speed, hard braking and time of day.	Varies	35 states: AL, AR, AZ, CO, CT, GA, IA, ID, IL, KS, KY, LA, MD, ME, MI, MN, MO, ND, NE, NJ, NM, NV, OH, OK, OR, PA, RI, SC, SD, TN, TX, UT, VA, WA, WV
Nationwide	SmartRide records miles driven, hard braking and acceleration, idle time, and nighttime driving. Doesn’t penalize policyholders for unsafe driving.	Up to 10% when you sign up and up to 40% for safe driving	50 states: AK, AL, AR, AZ, CA, CO, CT, DC, DE, FL, GA, HI, IA, ID, IL, IN, KS, KY, LA, MD, ME, MI, MN, MO, MS, MT, NC, ND, NE, NH, NJ, NM, NV, NY, OH, OK, OR, PA, RI, SC, SD, TN, TX, UT, VA, VT, WA, WI, WV, WY
USAA	USAA’s SafePilot app gathers information about your location, time of day while driving and whether you're the passenger or driver. It also measures the frequency of phone handling, hand-held calling, hands-free calling or harsh braking. Good drivers can receive a discount.	Up to 10% for signing up and up to 30% for safe driving when you renew your policy	16 states: AK, AR, AZ, IA, ID, KY, MD, MO, MT, NM, OH, OR, SD, TN, TX, VA
Travelers	90-day program — IntelliDrive — monitors the time of day you drive, as well as your speed, acceleration, braking, and distracted driving frequency. Rates increase if you have unsafe driving habits and decrease if you don’t.	3% to 40% off	36 states: AL, AR, AZ, CO, CT, DC, FL, GA, IA, ID, IL, IN, KS, KY, MD, ME, MN, MO, MS, MT, NE, NJ, NM, NV, OH, OK, OR, PA, SC, TN, TX, UT, VA, VT, WA, WI

Frequently Asked Questions About Pay-Per-Mile Car Insurance

Pay-per-mile car insurance is a relatively new product, so drivers often wonder how it works and whether or not it’s worth it. MoneyGeek answered some of the most common questions about pay-per-mile insurance to help you learn more.

When is pay-per-mile car insurance worth it?

Pay-per-mile insurance may be worth it if you drive infrequently. Sample rates provided by MetroMile suggest that people who drive less than 26 miles per week could save money with a pay-per-mile policy.

How do pay-per-mile car insurance calculations work?

Insurance companies calculate costs for pay-per-mile policies using two factors: a base rate and a rate per mile driven. Like they would for a standard insurance policy, your location, age, and past driving history influence these rates.

What is the best pay-per-mile insurance plan?

Nationwide is our top pick for a pay-per-mile insurance policy. The company's SmartMiles program provides coverage to 40 states around the country, making it the most widely available pay-per-mile program MoneyGeek evaluated. SmartMiles also tracks driving behaviors, awarding additional savings to policyholders who drive safely.

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About Mark Fitzpatrick

Mark Fitzpatrick is a Licensed Property and Casualty Insurance Producer and MoneyGeek's Head of Insurance. He has analyzed the insurance market for over five years, conducting original research and creating personalized content for every kind of buyer. He has been quoted in several insurance-related publications, including CNBC, NBC News and Mashable.

Fitzpatrick earned a master’s degree in economics and international relations from Johns Hopkins University and a bachelor’s degree from Boston College. He is passionate about using his knowledge of economics and insurance to bring transparency around financial topics and help others feel confident in their money moves.

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