Pay as You Drive Auto Insurance

There are some insurance companies out in California experimenting with pay-as-you-drive insurance.  What this means is that people who own vehicles but do not drive very often can get much lower insurance than someone who drives all the time and is a much larger risk. 

California has tried programs like this before.  The last time the proposal was to base your auto insurance off of how much gasoline you purchase.  That idea didn't get very far, but with the advent of GPS tracking the idea of pay-as-you-go insurance may have legs.

The big savings here are for people that only use their cars for pleasure trips or live in areas where all of their necessities are close by.  Another HUGE benefit would be for people in large cities with access to public transportation.  You could own a vehicle and not have to pay through the nose levels of insurance to keep it. 

The downside to this idea is a loss of privacy.  In order to qualify for this insurance you have to have the equivalent of an automobile version of the black boxes they put on airplanes.  This device will record not only how much you drive but how you drive.  I guess the upside to these devices would be that people would be more wary of their driving habits and maybe improve their technique.  Overall as long as they are not recording my phone conversations I am all for the idea of making insurance cheaper based off of your individual driving acumen instead of broad sets of averages.  This would give teenage drivers and young adults a chance of getting lower rates (and their parents might actually be able to know where they are).