Pay Per Mile Car Insurance | Is It Legit?

At the beginning of the year, I always sit down and review the best ways to save money in the new year. And after looking at vehicle expenses, I wanted to know what’s the best way to save money on car insurance? While I would prefer to not have a car since I live in a city, it’s actually insanely useful for getting out of the city on the weekends and taking a nice drive on a sunny summer day!

I’ve thought many times about selling my car, but I know I never will. It’s my dream car.

While many people want a Ferrari or a Porsche or maybe a vintage Mustang, the only car that I’ve ever really wanted (except for a VW camper of course), was a black on black Lexus Hybrid SUV. Oh man, I’m not really a car guy, but the first time I saw one, I couldn’t look away. I also listened to a ton of Notorious B.I.G in high school, and the dude raps about Lexus’s all the time. So I’m sure that subconsciously had something to do with it.

Looking back, I’m pretty sure that I spotted a trend because Lexus had the first rounded SUV and now pretty much every SUV looks like an old school Lexus. But I’ve got a pristine original with 62,000 miles on it. I bought it used 6 years ago with 48,000 miles on it.

Can Pay Per Mile Car Insurance Save You Money?

pay per mile car insurance

If you do the math, I’ve driven a total of 14,000 miles over the past 6 years or a whopping 2,333 miles per year. That kind of mileage isn’t much considering the average American guy in my age range drives 17,976 miles a year.

To say the least I don’t drive a ton, but I used to pay a ton for car insurance (about $95 a month at one point), which ended up costing me about $1,200 per year after taxes.

It always hurt to see that $95 on my credit card bill, so I eventually couldn’t stand it anymore and started searching the big companies for car insurance rates. They weren’t much cheaper. But then I saw a Google Ad (yes they are worth click on sometimes) for a company advertising ”pay-per-mile”. I thought, “whoa, that’s a cool idea.”

That was 4 years ago when I first discovered Metromile, who at the time was a small start-up in San Francisco, that had an amazing idea for pay per mile car insurance.

How Does Pay Per Mile Car Insurance Work?

With pay per mile insurance, you pay a low base rate (for when your car is parked) plus just a few pennies per-mile and your miles are tracked by a little device you hook to your car computer. It also helps you find you easily find your car with the mobile app if you lose it or it’s stolen (def a bonus since I actually have lost my car a few times in parking lots).

How Much Can You Save with Pay Per Mile?

But I had no idea how much money it was going to save me. I got a free quote in 20 seconds that has easily saved me over $2,500 on car insurance over the past 4 years. Probably even more actually, since that’s savings is just based on the $95 I used to pay, but that rate probably has gone up.

And if you know me, then you know I put that savings right into my investments, so the actual value of the $2,500 has grown to over $4,000 over the past 4 years. That’s a lot of money.

So, stop paying one of those big companies who run all of the ads you see on TV all the time because they are charging you for those ads. Sorry Gecko and Flo, I’d rather not pay for you. I just want amazing car insurance since people drive like lunatics and I’ll either hit someone or someone will hit me one day.

Who Has the Best Pay Per Mile Car Insurance?

If you have a car and don’t drive that much, definitely get a free car insurance quote at Metromile. I’m a long-time user and huge fan. It will definitely save you money. Seriously, stop paying too much for car insurance. Take 20 seconds and see how much you will save by clicking the banner below.


metromile ad

Grant Sabatier

Grant Sabatier

Creator of Millennial Money and Author of Financial Freedom (Penguin Random House). Dubbed "The Millennial Millionaire" by CNBC, Grant went from $2.26 to over $1 million in 5 years, reaching financial independence at age 30. Grant has been featured in The New York Times, Wall Street Journal, BBC, NPR, Money Magazine and many others. He uses Personal Capital to manage his money in 10 minutes a month.
Grant Sabatier

Latest posts by Grant Sabatier (see all)

Posted in: Car Insurance, Save Money

    Bull-Market Chris
    Posted Jul 09 2018
    Nice reference to the great Notorious BIG
    Posted Jan 16 2018
    Pay per mile insurance. That's defniitely new era stuff. I never heard of that before. I may have to look into it.
    Posted Jan 12 2018
    Interesting. Sounds like what we need. We have 2 cars that we drive very few miles each day. Will check it out.
    Accidental FIRE
    Posted Jan 10 2018
    I like the idea since I only drive about 7,000 per year, but I don't like the idea of being tracked obviously. Thanks for posting this though, I had never heard of this company!

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