Boston, MA – (WiredPRNews.com) One state senator in Washington introduced legislation last week that would require car insurance providers in the state to place more weight on a driver’s annual mileage when determining prices for coverage.
The legislation would authorize state regulators to develop a standard that insurers would be required to adhere to when setting up mileage tiers used for rating customers. It would also require coverage providers to give discounts to policyholders whose annual mileage comes in under the 5,000-mile mark.
Similar ideas have been gaining increased attention across the country in recent months. Government officials have released separate reports advocating for greater reliance on mileage when setting prices in both the New York and Massachusetts auto insurance markets. Officials in both of those state governments consider mileage-based coverage plans to be potentially viable ways of cutting congestion, pollution and the number of traffic accidents. These benefits would be the result of consumers’ cutting back on the time they spend on the road in order to save money on premiums.
Although many insurance providers in Washington already incorporate miles driven annually into their rating calculations, they are not required to do so by law. The reasoning behind requiring insurers to give discounts to low-mileage drivers is that statistics have shown motorists who put in the lowest number of miles behind the wheel annually tend to file claims at lower rates than those who drive more.
Progressive Insurance’s 2005 claims data was cited in a Brookings Institution study on mileage-based policies. It showed that motorists who drove 5,000 miles annually filed property damage and bodily injury claims at nearly half the rate of motorists who drove 20,000 miles annually.
To learn more about this and other coverage issues, readers can go to http://www.onlineautoinsurance.com/massachusetts/ where visitors can navigate to informative resource pages and can use the free quote-comparison generator to help find the lowest rate for a policy.