Auto insurance by km: how does it work?

With the end of ownership and the advent of the age of use, auto insurance needs have changed dramatically over time. The car insurance per kilometer is a fairly recent formula and for a certain class of drivers, the savings to achieve through this new formula are not negligible. As a general rule, kilometer insurance makes it possible to pay less for mileage less than 8,000 km per year, in which case it is good insurance.

The principle of auto insurance per kilometer

In addition to the so-called classic automobile insurance provided for by the Insurance Code, which establishes a rate for the year regardless of the rate of use of the vehicle, the insurance premium paid by the insurer according to the kilometer traveled was created in Anglo-Saxon countries. Today, two types of packages exist for underwriting with online car insurance and their principle is simple.

Kilometer Package

It is possible to take out a car insurance contract at the kilometric rate, fixing in advance a number of kilometers per year. The advantage of this insurance premium is that it can be reduced if the number of kilometers traveled is less than the initial estimate. Some companies also offer the option to defer the excess miles the following year. This type of car insurance involves knowing with a good precision the distance made by year with his vehicle.

For example, Corona Direct offers a mileage package with third-party insurance charged at € 182 for 2,000 km / year and € 211 for 5,000 km / year for a 48-year-old driver who drives a Volkswagen Golf 5D. / P Diesel 1.6 CR TDI77 BMT Trendline.

PAYD package

The Pay As You Drive (PAYD) package calculates the auto insurance rate based on the exact number of kilometers traveled. This formula is more suitable for drivers subject to varying driving times from one year to the next. To determine the mileage of the car, an electronic control unit GPS is installed in the passenger compartment of the vehicle to accurately measure the distance traveled. According to the insurers, the rental of this housing can be free or paid in addition to the contribution.

For example, Amaguiz Groupama Group, for a 2003 Opel Corsa offers a per kilometer price of € 0.023 plus a subscription of € 12.90 per month in all-risk insurance for a driver with a bonus of 0.50 . For a one-third-to-one formula, a 28-year-old driver with a 0.66 bonus will pay € 0.018 per km and € 9.90 per month for a 2001 Fiat Punto.

Guaranteed levels of insurance measured per kilometer

Like conventional insurance, the insurance per kilometer offers 3 levels of guarantees for the indemnification: the simple third, the extended third and all risks with the principle of the bonus-malus which is preserved. Third-party insurance, that is, third-party liability, is the mandatory minimum charge for any motorized vehicle. The “All Risks” formula offers more guarantees and covers even the insured in the event that his responsibility would be engaged during a disaster or in the absence of identified person in charge (damage, legal protection, breakage of ice, bodily injury) . You can make a quote simulation using an online auto insurance comparator on this page.

Insurance for whom?

Many insureds can find insurance very cost-effective depending on the kilometer made. Here is a non-exhaustive list of vehicle owners who can benefit from cheaper auto insurance per kilometer, as a small rider, on their insurance policy premium:

Older people who regularly use their vehicle but on a short distance will have every interest in taking car insurance per kilometer.
Some city dwellers who favor public transport on a daily basis but who own a personal car for occasional occasions such as shopping or going to their vacation spots.
Young drivers: students who have just passed their license and who only use their car on rare occasions will be able to benefit from very advantageous rates thanks to the insurance according to the kilometer traveled notably to compensate for the premium.
Owners of vintage cars will be able to continue driving in peace and at a lower cost for particular outings.
Some types of vehicles like campervans are perfect candidates for kilometer insurance
In addition, this package is particularly suitable for vehicles left permanently in a secondary home.