The premiums you pay on your auto insurance are usually based on your age, gender, and where you live. Pay As You Drive insurance however is different. It's based on the number of miles you drive. Drive fewer miles, pay lower premiums.

One advantage of Pay As You Drive insurance is the cost. Since the premiums are linked to how much the driver uses their vehicle, it is easy to reduce costs. Simply reduce the amount of driving you do. Not only will you save money on your insurance costs, you will also save on gas and auto maintenance and repair. Less driving also means less wear and tear on your vehicle, which means you will be able to keep your vehicle long after you make that last car payment. With the cost of new and used vehicles soaring, this is a particularly attractive incentive.

Another advantage to Pay As You Drive insurance is you can specifically tailor your insurance program to meet your driving needs. Premiums under Pay As You Drive insurance are determined either within a specific range of miles, by the total number of miles driven or by the number of hours driven. A driver can elect to have a Pay As You Drive insurance program that focuses on a specific time period, such as six months, or the driver can simply choose to focus on the total number of miles driven. Pay As You Drive insurance gives drivers plenty of freedom and flexibility when it comes to designing an insurance program that works for them.

Pay As You Drive insurance offers an incentive to drive fewer miles, and the less you drive, the less likely you are to get into an accident. Low mileage drivers tend to be more cautious and focused behind the wheel as well.

Mileage monitoring is required with Pay As You Drive insurance, but there are plenty of options for drivers. You can have certified odometer readings, much like you do when you have your vehicle's safety inspection. Or you can have a GPS based monitor installed in your vehicle, or you can simply have the computer data uploaded from your vehicle. Since only periodic mileage readings are needed to track the mileage for Pay As You Drive insurance, the cost associated with mileage monitoring will most likely be offset by the money you save in insurance premiums.

The Brookings Institution reported that two in three US households would save with Pay As You Drive, an average of $270 a year. In the current economic downturn, that is terrific news.

Moreover, not only does Pay As You Drive save you money, it protects the environment. Fewer vehicles on the streets and highways means a reduction in greenhouse gas emissions. Less traffic also means fewer traffic jams and less congestion, and less time wasted sitting in the car.

There are many advantages to Pay As You Drive. See or call your insurance agent to get more detailed information about a Pay As You Drive policy that meets all your insurance needs.

Tom Martens is the content syndication coordinator for Carinsurancesa.co.za. South Arica?s leading car insurance portal.

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