Are you driving less? Retirement or other lifestyle and career changes can lead to less driving. Additionally, more employees are working from home due to COVID-19, which reduces commuting. For some, working from home may continue even as we get through the pandemic. If you are a safe, low-mileage driver, you may want to look into Usage-Based Insurance (UBI).

How does UBI work?

UBI uses data collected while you drive to determine how much you pay for car insurance. Most data collected for UBI is done through mobile phone applications. You must download the application and agree to the data collection.

How do I know if UBI is an option I should consider ?

UBI programs are designed to save low-mileage, safe drivers the most money. Drivers who rarely drive at night, drive mostly during daylight hours, drive safely, and drive less will benefit most. However, a number of companies give a discount just for enrolling in the program.

Reliable data on savings is not easily available but insurance companies claim savings between 10% and 40% are possible depending on the UBI plan and your driving practices. Some insurers claim that most drivers save money in their UBI plan.


Keep in mind, your insurance costs may go up based on the results of your driving data. Insurance companies claim that rarely happens and some promise UBI will not increase your rate. But it is important to be sure that UBI is the right option for you and will be financially beneficial.

Questions to Ask Your Insurance Company or Agent

Before talking to a company or agent, have a good idea of how many miles you drive per week and when you drive the most (night or day). If other household members will also enroll, know the same information. Then ask:

  • Exactly what will the company be monitoring?
  • How long will my driving be tracked?
  • Will I have to install anything in my car?
  • What happens if I forget my phone or my in-car device gets disconnected?
  • Who else does the company share my data with?
  • What safeguards are in place over my location and other data?
  • What other purposes besides insurance rating is my data used for?
  • Can the UBI plan make my insurance go up?
  • Can UBI change my insurance rates before my policy renews?
  • How much can I expect to save?
  • When can I expect any discount on my insurance?
  • If I discontinue the plan, is the data still used to set my rates?
  • How can I discontinue the UBI plan?

*️⃣  To learn more about auto insurance, visit The BasicsShopping Guide, and Know Your Rights sections of our website.