Mileage-based coverage

Mileage-based coverage is a car insurance model that sets premiums based on actual miles driven, not estimated mileage. Insurers like Metromile and Allstate Milewise use telematics devices or smartphone apps to track mileage precisely.

Drivers typically save 20%–40% compared to traditional plans if they drive under 7,500 miles per year, according to research from the National Association of Insurance Commissioners (NAIC). Policies calculate cost using a base rate plus a per-mile fee, so infrequent drivers such as retirees or remote workers benefit most.

Many policies cap daily charges, for example, Metromile does not charge for more than 250 miles/day. Claims, liability limits, and coverages in mileage-based policies match traditional auto insurance standards in all U.S, according to a report from YourInsurance.info.

States where available. Most providers require regular odometer readings or GPS-enabled data uploads as proof of mileage.

Mileage-based coverage can affect discounts: safe-driving or loyalty discounts still apply but low-mileage replaces good-driver incentives. Coverage generally excludes commercial driving uses (e.g.

Uber/Lyft) unless specifically endorsed by insurers such as Root. If you exceed your estimated mileage, providers automatically adjust your bill for the additional miles without lapsing coverage.

State regulations mandate minimum required coverages within these programs in states such as California, Texas, and New Jersey.