Pay-as-You-Drive Car Insurance Proposed in California
In a move designed to encourage citizens to drive less and reduce greenhouse gas emissions, Pay-as-you-go car insurance is being heavily promoted in the State of California after successful implementation in more than 30 other states. Steve Poizner, Insurance Commissioner for the state of CA, is pushing this pay-as-you-go idea for California drivers: in a recent press release, Poizner stated "I am thrilled to pave the way for California drivers to obtain insurance that is more environmentally friendly and more accurately reflects driving habits,". He went on to say "As a strong advocate of healthy market competition and a healthy environment, I am especially pleased to encourage this kind of innovation and additional options for consumers."
He describes this form of auto insurance as “green” because it will motivate drivers to not drive as much, thus lessening the release of greenhouse gasses.
Current regulations on car insurance require it be based on estimated yearly average of miles driven. The new bill to pass pay-as-you-go insurance would bring forth new regulations for consumers to verify their mileage using various avenues: odometer readings, car repair records or by using a device that can inform the insurance company of your miles traveled. Of course, this device cannot read driving patterns or locations for that would be an invasion of privacy.
The environmental Defense Fund estimated that if 30% of California drivers participate in the pay-as-you-go insurance option the state could avoid 55 million tons of carbon dioxide between 2009 and 2020. That equates to the removal of 10 million cars off the road. Not to mention the 5.5 billion gallons of gas and its expense saved.
Thirty-four states already have pay-as-you-go insurance and a study released in July of this year said that if all drivers’ chose this option driving would be reduced by 8%, CO2 emissions by 2% and gasoline consumption by 4%. On average the majority of household would save a few hundred dollars per car with this option.
The regulations should take no longer than the fall of 2009 to be completely set in place, and the California Air Resources Board advocates this proposal, so hopefully the decision will be passed down sooner.
Labels: auto insurance, california, car insurance, emissions, green, law making, regulations, save money
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11:45 AM
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