What Is the Low Mileage Discount?

When you drive fewer miles, you're at less risk of accident and injury. Keeping your driving down can also get you a low mileage discount on car insurance.
Happy driver with short commute

Your insurer may look at how much you drive each year when deciding your rates. The reason is simple: you’re at a higher risk to get into a car accident if you drive more often. Staying off the road is a great way to help keep you out of trouble. You could also get a low mileage discount on your auto insurance premium.

It’s not uncommon to hear about “low mileage insurance” that you can get from your auto insurer. However, you don’t usually find these benefits listed on provider websites. But most track or ask about how much you drive. This can end up affecting your rates.

The number of miles you drive each year affects your rates. Insurers see heavy or frequent drivers as a risk to get into accidents and, as a result, cost them more money. This means that if you drive less, you’ll look like less of a risk and could get lower rates.

Insurers love occasional drivers and compensate them in some way. Even so, many carriers provide few details about how your driving affects your rates. You won’t find anything on their websites and your agent may not mention it unless you ask.

This article will help you understand how insurers reward customers for driving less. We’ll talk about how much you can save and which insurance companies offer the low mileage discount.

How the Low Mileage Discount Works

You can potentially get a discount and save on your premium if your annual mileage is below a certain threshold. Depending on your insurer, this number is usually somewhere around 7,000 to 12,000 miles per year. It can sometimes be more.

However, keep in mind that your insurance provider won’t have an official low mileage discount. Even so, it may still reward you with a discount if you can keep your driving down.

Telematics Devices and Mileage Tracking

Some auto insurance companies may want you to use a telematics device that records your actions behind the wheel. This could be in the form of a physical device you install in your car or a mobile app from your insurer. Carriers often use these to track safe driving and include mileage as a factor that shows how safe of a driver you are. Below is a list of common things telematics tracks for your provider:

  • Your speed
  • Your acceleration
  • How hard you brake
  • Your mileage
  • When you drive

Pay-per-mile insurance is another form of usage-based telematics. When you pay for coverage based on the distance you drive, paying less for driving less is automatic. It’s not a discount, but it works in a very similar way in that you pay lower rates for driving fewer miles.

Who Qualifies?

Almost anyone can reduce their premium by driving less each year. But certain groups of people are more likely to save than others. For example, someone who works from home probably has a better chance of qualifying than someone with a long commute.

You’ll put fewer miles on your odometer and, therefore, pay less for car insurance if:

  • You work from home. Besides saving you from stress, working from home can save your car from the wear and tear of a daily commute.
  • You’re a carpooler. Carpooling with friends or co-workers can help keep your annual miles down. Even if you sometimes use your vehicle to carpool, you’ll still come out ahead.
  • You frequently use public transportation. Using public commute options such as buses, light rails, or trains can help you avoid unneeded miles on your car.
  • You’re a student. Students who are away at college might not need to drive that much if their campus has everything they need. College students who leave their vehicle at home won’t be driving much and could even qualify for the student away discount.
  • You’re retired or a senior citizen. You likely don’t drive to work every day if you’re retired. This will help keep your miles down and allow you to save on insurance, which can be higher for people 60 and older.

Companies with a Discount for Low Mileage

Several of the leading insurers offer a low mileage discount when you drive below a certain number of miles each year. Many of them do this by estimating your driving activity with telematics. This is usually a part of many insurers’ safe driver discount programs.

Insurers may also offer pay-per-mile or usage-based (UBI) options. These alternative policies and plans help you pay only for the miles you drive, allowing you to shell out less for auto insurance each month.

Note: some discounts aren’t available in every state. Contact your carrier to see if you qualify.

Below is a list of major national insurers that offer a low mileage discount:

State Farm

You’ll get a discount from State Farm if you drive fewer miles. The company also has a program called Drive Safe & Save that tracks your driving habits. This program could save you up to 30% on car insurance. You can use it as a mobile app or through OnStar.

The Drive Safe & Save program allows State Farm to estimate how much you drive, potentially making it easier to qualify. Be aware that you could lose your eligibility and pay higher rates if your mileage increases.

Nationwide

Nationwide doesn’t lower rates for reduced driving. Rather, it offers a pay-per-mile car insurance program called SmartMiles. With this program, you’d pay a base rate and a varying monthly rate depending on how much you drive. SmartMiles uses telematics to track your trips and help you save if you drive less frequently.

GEICO

GEICO has no official reward for reduced driving. Even so, how far you drive each year is a factor when the it sets your rates. This means your rates could go up if you drive more. Even so, occasional drivers often get rewarded with lower premiums.

GEICO also has a program named DriveEasy to reward safe drivers. To get started, you’ll have to install the mobile app and sign up. The app monitors your driving behavior, including how far you drive. In this way, you may be able to receive savings based on the distance your drive.

Allstate

Allstate has a pay-per-mile policy called Milewise. Allstate says that Milewise can allow you to save anywhere from 20 to 72% on your coverage when you’ve driven 10,000 miles per year or less. Milewise comes with a daily base rate and a per-mile rate. Be aware that it’s not available in every state. Contact your Allstate agent for more information.

Progressive

Progressive takes how much you drive into account when it decides your premium. You’ll be charged less when you drive less, but the company doesn’t have a discount for it. Instead, Progressive’s Snapshot program may give you a chance at lowering your premium if you don’t drive much.

Like other insurers’ safe driver programs, Snapshot uses telematics to monitor your driving habits and potentially give you a discount. Your annual miles are one of the metrics it monitors. You’ll need to download the app or plug a device into your car to use it.

USAA

USAA will lower your premium for infrequent driving. You’ll pay up to 60% less when you need to store your car for any reason. Contact your USAA agent to find out exactly how much you can save, whether it’s available in your state, and how little you must drive to qualify.

Liberty Mutual

Liberty Mutual considers total miles driven when you join its pay-per-mile program called RightTrack. Using a telematics device, this program tracks your car’s miles every month and will calculate your rates. You may need to reach out to Liberty Mutual to find out more about how to enroll.

Farmers

Farmers’ Signal app can help you get a low mileage discount. Like other carriers’ programs, the program enables Farmers to track your driving and potentially reward you. It watches things such as when you drive, how much you drive, and how fast you drive your car. Call your Farmers agent for more detailed info about how much you can save with Signal.

Travelers

Travelers offers a low mileage discount to drivers in a few select states. To qualify, you must sign up for IntelliDrive, a telematics program that tracks driving behavior. Just for joining and agreeing to let Travelers monitor you behind the wheel, your premium is reduced by 10%. If you put less than 13,000 miles on your odometer each year, you could qualify and see an additional 30% in savings.

American Family

American Family rewards drivers that put no more than 7,500 miles on the odometer each year with a low mileage discount. You could also get additional savings through AmFam’s usage-based KnowYourDrive program which uses an app to track your driving habits.

Farm Bureau Financial Services

Farm Bureau offers a low mileage discount when you drive your car less than 7,500 miles a year. Its website doesn’t specify the savings. You’ll need to contact the insurer directly or ask an agent to learn more.

Auto-Owners

Auto-Owners offers a low mileage discount to customers that drive less than 10,000 miles a year. The insurer doesn’t say how much you’ll save. It depends on a few things. One of those is exactly how much you drove in your previous policy period.

Before the end of your current policy term, Auto-Owners will contact you and ask for a photo of the insured vehicle’s odometer. Another option is to use the annual mileage discount form. Once you’ve uploaded the photo, the provider will evaluate your driving miles and other rate factors to determine your savings. It’s as easy as that.

Mercury

Mercury offers drivers that limit their driving an opportunity to lower rates through the RealDrive discount program. When you sign up, Mercury tracks how far you drive and rewards you with a low mileage discount when you keep driving to a minimum.

Discounts for Low Mileage by Company

Insurance CompanyMilesMax Savings
Allstate10,00020-72%
American Family7,500Varies
Farm Bureau7,50020%
Auto-Owners10,000Varies
Travelers13,00010-40%
MercuryVaries5%-Varies
Note: table data found on the above insurers’ websites.

Frequently Asked Questions

What is a low mileage driver?

These are drivers that put around 7,000 to 10,000 miles per year on their car odometers. Remember that every insurance company will have its own requirements, meaning that the number could even be higher than 10,000 miles per year. In the long run, these are usually people who don’t need to drive that often. Common examples include:

  • People who work from home
  • People who carpool or use public transit
  • Retired people
  • College students

Is it possible to get car insurance for low-mileage driving?

It may not be called low mileage, but you can get coverage for infrequent driving. Many major insurers offer pay-per-mile or UBI plans that target occasional drivers. You could pay a lot less with these than with traditional policies. There are also companies like Metromile that offer similar pay-per-mile plans.

Can my insurance go up if I drive too many miles per year?

The number of miles you put on your odometer each year is a car insurance rate factor. If companies give you a low mileage discount for driving less, there’s a chance they could raise your premium if they think you spend too much time driving. This is because, in their eyes, you’re at a higher risk of being in an accident when you drive more.

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