The Best Pay-Per-Mile Auto Insurance

Metromile disrupted the insurance industry in 2011 when it offered pay-per-mile auto insurance policies exclusively. The insurance company Lemonade acquired Metromile in 2022, but it continues to offer service under its original name.

Metromile has more than 100,000 customers so far and boasts that it can save you up to $947 per year on your auto insurance. Its monthly base rate starts at just $29 and its additional per-mile rate is just a few cents. The company calculates your mileage for you using a device known as Pulse that you keep in your car.

Robust Mobile App

Metromile has a robust mobile app that helps you manage your policy. The app makes it easy to edit your personal information, add drivers to your policy, or access your insurance cards.

Additionally, your Metromile app connects to your car. You can check your mileage and view your recent trips easily. Plus, the app will send you street-sweeping alerts to help you avoid parking tickets.

A unique feature of the app is that it can help you find your car. According to Metromile, the company’s app has a 92 percent stolen car return rate.

Accelerated Claims Process

If you’ve ever had to file an auto insurance claim, you know the process can be a long one. Metromile accelerates that process by removing some of the usual steps, including waiting for an adjuster, to move your claim along.

When your car sustains covered damage, start the claims process on your mobile app. Metromile’s AI claims system will verify your coverage and guide you through the process of collecting photos of the damage and pulling data from your Pulse device.

Next, the AI claims system will connect you with a local repair shop. If your policy includes rental car coverage, it will help you through the process of reserving a rental vehicle. Finally, once the repair process has begun, an insurance adjuster will help you complete the process.

Savings for Multiple Vehicles

If you have multiple cars and insure them all with Metromile, you’ll qualify for an auto insurance discount. The company offers a discount on both your base rate and your per-mile rate when you have two or more vehicles on your policy. Metromile’s website doesn’t state how much the discount is, but even a small amount off your premiums is a win.

Root is a newer insurance company, founded in 2015. The company sets its insurance premiums based on your driving habits, meaning safe drivers pay lower premiums. According to Root, you can save up to $900 on your premiums by switching to its coverage.

Savings for Safe Drivers

If you’re a safe driver, Root will reward you with lower insurance premiums. Unlike the other companies on our list, Root doesn’t set your rates depending only on your number of miles driven. Its monitoring app looks at factors like your phone usage while driving, as well as braking, turning, and typical driving hours (since it’s more dangerous to drive at night).¹

Root even allows you to find out ahead of time what your premiums will be using its Test Drive feature. When you use Test Drive, you’ll drive around for a few weeks with Root monitoring your driving. Based on the information it collects, Root then tells you whether it can insure you and what your rate would be.

Forgiveness for Past Driving Violations

Many insurance companies base their premiums on a customer’s driving history. An accident or speeding ticket on your record can cause you to pay more for insurance for years to come.

And while it’s true that Root specifically gears its product toward safe, low-mileage drivers, the company forgives those who have made mistakes in the past. Even if you have violations on your record, you can get an affordable policy as long as you meet Root’s requirements for safe driving today.

The company even offers SR-22 certificates. An SR-22 is a form you may be required to file with your state to prove you have car insurance if you have committed certain violations, such as reckless driving, driving under the influence, or driving without insurance.

Because those with SR-22 requirements are high-risk drivers, they often struggle to find affordable insurance. Root is a great option for SR-22 drivers who drive safely today.

Widespread Availability

Pay-per-mile insurance is still relatively uncommon, and premiums that are almost entirely based on your driving behavior are even more uncommon. As a result, many companies that offer these policies only do so in a handful of states.

Root, on the other hand, now offers its policies in more than half of all states. You can get a Root policy in the following states:

• Alabama
• Alaska
• Arizona
• Arkansas
• California
• Colorado
• Florida
• Georgia
• Hawaii
• Illinois
• Indiana
• Iowa
• Kansas
• Kentucky
• Louisiana
• Mississippi
• Missouri
• Montana
• Nebraska
• Nevada
• New Mexico
• North Dakota
• Ohio
• Oklahoma
• Oregon
• Pennsylvania
• South Carolina
• Tennessee
• Texas
• Utah
• Virginia
• West Virginia
• Wisconsin

Allstate is one of the biggest names in auto insurance, and while it primarily offers standard policies, it also has pay-per-mile policies through its Milewise program. This type of policy is perfect for Allstate customers who want to stay with their insurance company and save money with low mileage. Allstate charges its Milewise customers a flat daily rate, and a per-mile rate on top of that.

Mobile App With Many Features

If you’re already an Allstate customer, you may know that the company is well-regarded for its excellent mobile app. Milewise customers get to enjoy those same great features.

First, the Allstate app makes it easy for you to see details about your policy and account quickly. Additionally, you can see your past trips, including your number of miles driven. The app gives you personalized driving feedback to help you become a safer driver. Additionally, the app allows you to set weekly spending goals for your insurance.

Another excellent part of the app is its vehicle maintenance features. You can see your vehicle’s diagnostics, get reminders about your car maintenance, and find a mechanic near you.

Trustworthy Claims Resolution

If you want an insurance company with a trustworthy claims process, Allstate could be a good fit. First, the company earned a rating of 889 out of 1,000 on J.D. Power’s 2022 U.S. Auto Claims Satisfaction Study.²

Only five companies — Amica Mutual, NIM Insurance Co., Erie Insurance, Auto Club of Southern California Insurance Group, and USAA — ranked higher. It’s worth noting that none of those companies offer pay-per-mile insurance to the general public (as USAA’s coverage is only available to military families).

Additionally, Allstate has a strong financial strength rating from AM Best. With a rating of A+, Allstate is financially stable and is fully able to pay out its claims.³

Access to Allstate Discounts

Pay-per-mile insurance doesn’t always come with access to the same discounts you’d get with traditional auto insurance, but Allstate is the exception. When you sign up for Milewise, you can take advantage of certain driver-based discounts:

• New car discount if you’re the first owner of your vehicle
• A discount for being unmarried, under the age of 25, and having a grade point average of either a B- or a 2.7 and higher
• Savings when you complete the teenSMART driver education program
• Having an anti-theft device and/or anti-lock brakes on your car

While Allstate doesn’t offer its normal safe driving discount to Milewise customers, you will have access to the Allstate Rewards program. You can earn points for safe driving and use those points to buy merchandise, get gift cards, and take advantage of daily deals.

USAA is a financial services company that offers a variety of products to military families, including auto insurance. USAA now offers usage-based insurance through its program Noblr. These pay-as-you-drive policies reward you when you drive low mileages, as well as when you engage in other safe driving practices.

Affordable Premiums

USAA is known for its affordable insurance premiums. Its policies come with some of the best rates in the industry, and its usage-based insurance rates are no exception.

Our data shows that a standard USAA auto insurance policy costs roughly $1,151 per year. For a Noblr policy, you could pay less than half that amount. Even compared to other pay-per-mile providers, USAA’s rates are the best.

Savings for Safe Drivers

Noblr policies already have affordable premiums, but you can save even more by making safe driving decisions. Here are the factors that Noblr tracks that could affect your rates:

• Mileage: The fewer miles you drive, the less you pay.
• Smoothness: You’ll pay a lower premium for demonstrating smoother braking and acceleration.
• Focus: Noble rewards you for using hands-free features or not using your phone at all while driving.
• Road choice: Certain roads may be safer than others, and you may get a lower premium for choosing those safer roads.
• Time of day: Save money on your premiums by limiting your driving to daytime hours.

Excellent Customer Service

USAA consistently ranks among the best customer satisfaction in J.D. Power studies. In the auto claims satisfaction study we referenced earlier, USAA scored an 890 out of 1,000.

Additionally, USAA ranked highly in J.D. Power’s 2022 U.S. Auto Insurance Study for overall customer satisfaction. This study breaks down customer satisfaction for different regions, and USAA ranks first in 10 out of 11 regions. In the only region where USAA didn’t rank first — California — it ranked second.

It’s worth noting that USAA has slightly more complaints than average with the National Association of Insurance Commissioners(NAIC). For auto insurance, USAA has a complaint index of 1.06. The target complaint index would be 1.0.

The NAIC finds this number by dividing the company’s share of the complaints in the auto insurance market by its share of the premiums. USAA’s rating indicates that it receives 1.06 times the number of complaints as expected based on its share of the auto insurance market.

Nationwide is another of the largest auto insurance companies in the state, ranking eighth in the nation for the value of premiums written.⁴ Nationwide SmartMiles program has two costs: a monthly base rate and a per-mile rate. While the company doesn’t state what its rates are, the example on Nationwide’s website uses a base rate of $60 and a per-mile rate of $0.07.

You can participate by either installing a device in your car or connecting your car directly. To connect your car directly, you’ll need to have a vehicle that’s newer than 2015, has a data communication module (DMC) installed, and is from one of the following manufacturers:

• Acura
• General Motors
• Genesis
• Honda
• Hyundai

From there, Nationwide will track your mileage and charge you accordingly.

Available in Almost All States

As of February 2023, SmartMiles is available in 45 states — every state except Alaska, Hawaii, Louisiana, North Carolina, and New York.

This widespread availability is especially good news if you’re an existing Nationwide customer, because it means you’re less likely to have to switch insurance companies to take advantage of pay-per-mile coverage.

Savings With Nationwide Discounts

Nationwide allows you to lower your SmartMiles base rate by taking advantage of any of its many discounts. First, Nationwide offers SmartMiles customers a 10 percent safe driving behavior discount.

Other discounts are available for the following actions:

• Bundling your Nationwide policies
• Being a student between 16 and 24 with a B average or better
• Taking a defensive driving course
• Having an anti-theft device in your car
• Signing up for automatic payments
• Signing up for paperless billing
• Maintaining a driving record free of accidents or major violations for at least five years

When you sign up for SmartMiles, Nationwide will monitor your driving to count your miles traveled. But it also pays attention to your other driving habits, and if the company deems you to be a safe driver, it will lower your premium. Here are some of the criteria SmartMiles monitors:

• Whether, and how often, you engage in hard braking
• Whether, and how often, you engage in fast acceleration
• Whether you drive between midnight at 5 a.m. often, which according to Nationwide can increase your risk of an accident

Access to All Nationwide Coverages

In addition to giving you access to all of its discounts, Nationwide also allows you to enjoy all of its coverage options, with a list that’s more extensive than many pay-per-mile companies offer.

In addition to standard coverages, Nationwide SmartMiles customers can reap the following benefits:

• Towing and labor: Nationwide covers towing and labor costs if you break down, get stuck, or are in an accident and don’t have collision coverage.
• Rental car expense: After a covered accident, Nationwide pays for your rental car or other transportation.
• Gap insurance: This coverage applies if your car is totaled and the insurance payout is less than what you owe on your loan or lease. Gap insurance covers the difference.
• Accident forgiveness: With this optional coverage, you can avoid a rate increase after your first at-fault accident.
• Roadside assistance: Nationwide will provide 24/7 coverage for emergencies like tire changes, jump-starts, towing, or fuel.
• Vanishing deductible: With this optional coverage, you can earn $100 off your deductible each year, up to $500. If your deductible is only $500, it will disappear altogether after five years.