New start-up company to offer new pay-per-mile service for motorists in the UK
A new start-up company is set to launch the first ever pay-per-mile car insurance policy for drivers here in the UK.
By Miles, a UK-based car insurance company, believe that annual car insurance policies aren’t the best option for some motorists and pay-per-mile insurance cover could be a better and more flexible alternative.
Their new pay-per-mile policies are set to launch later in the year, with the promise that premiums will be cut for drivers who do little mileage.
The insurance company will record each car journey with a telematics ‘black box’ and only charge the motorist for each mile driven, rather than having to pay out for annual cover.
A By Miles app will inform the driver how much each journey has cost and a bill will be sent at the end of the month.
The driver will receive a tiny telematics device which simply plugs into their vehicle’s on-board diagnostics port, located under the steering wheel – data gathered by the device is sent back automatically. The system will also be able to work abroad.
According to co-founder and CEO of the new start-up company, James Blackham, insurance policies were crying out for an update and haven’t seen any changes for 50 years.
“Right now insurance is ‘all you can drive’ but in this modern age that doesn’t necessarily make sense, especially if you’re driving less than the average number of miles in each year, which is about 7,500,” said Mr Blackham.
The cost of these new pay-per-mile policies have as yet not been revealed by the company but they say motorists who only drive at the weekend, or take small journeys each week, will save money.
The company have received financial backing from Jaguar Land Rover and hope in the future to do away with the black box, choosing instead to let the insurers work directly with manufacturers.
There are other insurance providers in the UK offering motorists flexible options including Insure the Box and Cuvva, however By Miles are the first ones to offer a pay-per-mile insurance policy.
“Developments such as these show how the insurance industry is matching innovations in car technology with new products that allow increased flexibility for drivers,” said Ben Howarth, senior policy adviser at the Association of British Insurers.
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