Usage-based insurance (UBI) uses a phone app or a plug-in device to measure your actual driving, then prices your policy partly on that data.
What it tracks
- Hard braking and rapid acceleration
- Speed and time of day
- Total miles driven
- Phone handling while driving
Who benefits most
- Low-mileage drivers
- People with smooth, predictable commutes
- Drivers who rarely drive late at night
Safe, low-mileage drivers commonly save 10-30%.
The trade-offs
Some programs can raise your rate if your driving looks risky, and a few drivers dislike the privacy trade-off. Ask whether the program is participation-discount only or whether it can also penalize you before you enroll.