We have referred on this Blog to the benefits of Pay As You Drive car insurance. To summarize briefly, this car insurance product is based on the principle “Drive a lot, pay more. Drive less and save!”
There are also environmental benefits as well as expectations that drivers will drive with more caution whilst aware that a Big Brother is monitoring their driving. In this Blog we would like to focus on a specific group that might benefit from a Pay As You Drive car insurance product – The High Risk Driver!
Who are the high risk drivers?
I would like to refer to the Blog post titled “Why do young and elderly drivers pay so much more for car insurance?”. In this Blog post we have identified the younger drivers [ 18-25 years] and the elderly drivers [65 years+] as the highest risk to car insurance. It is important to recognize that this is based on actual accident statistics.
If any driver in these age groups requests a car insurance quote, he/she will automatically fall into a higher pricing category before other variables such as the driving/ accident record, the area that they reside or the vehicle that they drive etc will be considered.
How can these young and elderly drivers reduce the risks of accidents?
We have offered some advice to these high risk drivers:
Advice to Younger drivers:
- Shop around for your car insurance – make your increasing years of driving experience and age count as you get older
- Try to maintain a safe, accident free driving record
- Find an accredited advanced driving course recognized by your car insurance company
- Be alert to the effect that the car you are driving might have on your premium
- Pay close attention to vehicle security systems and safety features that could reduce your premium
Advice to older drivers
- Try to maintain your safe, accident free record
- Ensure that your lifestyle counts in your favour and you get recognized for the safe area you stay, your closed garage, vehicle security systems etc.
- If you drive less – this should be recognized in your premium – enquire about Pay as You Drive Car Insurance
How can Pay As You Drive car insurance and data recorders help our High Risk Drivers?
Some of these high risk drivers might pose less of a risk when they drive much less than the average driver in this age group. Less exposure to other road users and roads risks should result in them paying reduced premiums for car insurance.
This reduced exposure to risk can be measured by odometer readings, or more advanced data recording devices. Some insurers now provide insurance products called “Pay As You Drive”, recognizing that reduced distance travelled should be rewarded with cheaper car insurance premiums.
We can illustrate how these higher risk drivers can be saved from financial hardship with a Pay As You Drive Car Insurance product:
Elderly Road Users:
Mr and Mrs Jones have retired at age 65. They have left the hectic city life and reside at their holiday home at the coast. They only travel short distances to the supermarket and only occasionally travel longer distances to visit their children. A Pay As You Drive car insurance product will recognize that they travel much less and provide cover for the reduced exposure to road risks!
Young Drivers
Not all young drivers are exposed to the same risks. Jane is a 23 year old student who travels to University about 500km’s away from her home in a rural area. Whilst attending to her studies she resides in a hostel on campus. She walks to classes and only travels long distances when returning home for the holidays. She travels short distances now and then when going shopping in the city. She is much less exposed to road risks than her friend who, at the same age is working as a sales rep for a pharmaceutical company. Her Pay As You Drive insurance product calculates her insurance premium on the distance driven each month.
It is also possible that when the young driver is not the owner of the vehicle, but described as the regular driver in the insurance policy, that driver would be more cautious knowing that the vehicle owner/ parent has access to a report on her driving as provided by the data recorded in the vehicle.
These data recorders or black boxes measure how fast the car is going and how long it is being driven for. It sends this information back to the insurer, which will use it to work out people’s premiums. New technology can even assess people’s driving styles by recording how fast they take corners and how aggressively they accelerate, meaning insurers can take this into account when working out the amount people should pay.
We would like to urge all “High Risk” drivers to shop around for their car insurance and consider the benefits of Pay As You Drive Car Insurance.