"Usage-based insurance, often called UBI or telematics insurance, leverages driving data to adjust premiums based on how, when, and how much a vehicle is driven. The National Association of Insurance Commissioners (NAIC) explains that UBI uses devices or smartphone apps to monitor key metrics such as miles driven, time of day, braking behavior, and acceleration. Here are the key elements of how UBI operates. Monitoring Mileage: Driving fewer miles generally equates to a lower risk of filing a claim."
"If a driver's patterns have shifted, there may be a chance to benefit from updated usage-based insurance (UBI). Consider these common scenarios. A driver's job moves to remote work, or they now commute less frequently. The vehicle is used only for errands or leisure rather than daily commuting. A person switches to car sharing, ride hailing, or alternative transport for part of the year. Driving occurs primarily in low-risk environments (e.g., fewer miles, less night driving, no heavy traffic routes)."
Usage-based insurance (UBI) adjusts auto premiums using driving data collected by devices or smartphone apps. UBI monitors mileage, time of day, braking, acceleration, and other driving behaviors to estimate risk. Drivers generally must opt in for data collection, and the specific technology and data policies vary by insurer. Significant reductions in vehicle use—such as remote work, seasonal car sharing, or shifting to errands-only driving—lower exposure and claim likelihood. Safer driving habits and reduced night or high-speed driving further decrease risk. Aligning premiums with actual usage can reveal potential savings or indicate overpayment.
Read at Miami Herald
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