Is Driving With Usage Based Insurance Your Best Option?
Is Driving With Usage Based Insurance Your Best Option
?There are many different types of insurance policies out there; you simply need to determine which would be the best for your needs. You will probably come across the term usage based insurance somewhere along there, and it is important that you understand what this type of insurance has to offer before you jump the gun and turn it down! It could be the best insurance choice for you; you simply need to do some research.
Reading an article about usage based insurance is your first stop, so if you are reading this, you are doing well already! Research is one of the best things you can do! You need to know exactly what usage based insurance is before you sign on the dotted line!
Well, usage based insurance is a very innovative creation that is now rapidly growing in popularity in South Africa. More and more people like the idea of only paying for insurance related directly to how far they have driven each month. Usage based insurance is popularly known as pay as you drive insurance in South Africa and is based on a cent per kilometre rate. Your insurance company will create a cent per kilometre rate based on your risk profile. Luckily, most usage based insurance companies will not begin charging you until you have driven over a certain amount of kilometres. Naturally, you will have a small set fee that you have to pay every month which contributes to your vehicle's theft risk, and will cover you if your car is stolen, or if there is any damage caused by something else besides a collision.
You may wonder how the car insurance company knows how far you have travelled each month. They are able to do this by the use of a tracking system which is installed in the vehicle upon commencement of the policy. This tracker doubles up as a security device which helps to lower the insurance premium because the insurance company will know that should the vehicle be stolen; the insurance company will be able to track it down.
Usage based insurance is a very good choice for people who believe that it is unfair for them to have to pay the same amount for insurance as other people who are on the road all day long. With regards to its calculations, usage based insurance seems to be a fairer way of calculating insurance premiums. The nice thing about pay as you drive insurance is that you can also track how far is being travelled by going on the insurance company's website. This comes well in handy for companies who are utilising pay as you drive insurance for their employees.
It is easy to see why so many people are choosing to go with pay as you drive, or usage based insurance. It can be a very cost effective way of insuring your vehicle, and is also a nice way of helping you to keep track of how much money you are actually spending on insurance every month.
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