4 Best Pay-As-You-Go Car Insurance Companies (2025)

Pay-as-you-go car insurance premiums vary each month depending on how frequently and how many miles you drive your car. Your monthly premium will have two parts: an unchanging base rate and the variable portion.

Most pay-as-you-go insurers base the variable portion on your actual mileage each month. But some insurers calculate usage costs in other ways.

If you’re considering pay-as-you-go insurance, here’s what to know about how it works, which insurers offer it, and how to compare quotes to find the best price on coverage that meets your needs.

How pay-as-you-go car insurance works

Pay-as-you-go car insurance provides the same types of coverage as standard auto insurance policies.

You can get minimum coverage, which is your state’s required amount of liability insurance, or full coverage, which typically adds comprehensive and collision insurance to a basic policy. If you opt for collision and comprehensive, you’ll have a deductible.

When you enroll in pay-as-you-go car insurance, most insurers will consider common rating factors to set your rates. On top of a base rate, you’ll pay a per-mile amount that depends on the number of miles you drive each month. This is why companies often call this type of coverage pay-per-mile auto insurance.

Some insurers will also track your driving habits and reward safe driving with bigger savings.

How to get pay-as-you-go car insurance

You can buy a pay-as-you-go policy the same way you buy a standard car insurance policy. You can deal with an agent or broker, apply directly on an insurer’s website, or use an online comparison platform to compare quotes from multiple companies.

Best companies for pay-as-you-go car insurance

Best overall pay-as-you-go car insurance: Allstate Milewise

Best for availability: Nationwide SmartMiles

Best for minimum coverage: Hugo

Best for ease of use: Mile Auto

Cost of pay-as-you-go car insurance

Several factors can affect your pay-as-you-go car insurance rates. Age, gender, driving history, credit history, state, ZIP code, and more are all factors insurers consider when setting rates.3

Generally, though, you can expect your monthly pay-as-you-go premium to include a base rate and a per-mile rate.

Here are the national average monthly rates for some top pay-as-you-go insurers, according to Insurify data.

Pros and cons of pay-as-you-go insurance

Pay-per-mile car insurance can help low-mileage and safe drivers save money. How much you save will depend on the company and your unique situation, but insurers with pay-per-mile offerings claim savings of 40% or more off standard car insurance rates.

But not everyone will see significant savings with pay-as-you-go insurance, so it’s important to weigh the pros and cons of the coverage before buying it.

Who should consider pay-as-you-go car insurance

Pay-as-you-go insurance isn’t for everyone, but it may be a good choice for:

• People who drive fewer than 10,000 miles per year

• Students or the parents of students living away from home

• People who work from home

• Senior drivers, who typically log fewer miles than other age groups

• Safe drivers who avoid hard braking, speeding, and other behaviors that can negatively affect rates

• City dwellers who rely on public transportation but still need car insurance

• Multiple-vehicle owners who have one car they rarely use

Usage-based insurance (UBI) vs. pay-as-you-go

Pay-as-you-go or pay-per-mile insurance is a type of usage-based insurance (UBI), which bases your rates on how, when, and how much you use your vehicles.4 Pay-as-you-go insurance usually ties your variable rate to the number of miles you drive in a month.

Other types of UBI may also factor in when and where you drive, how you drive, and even if your vehicle’s technology reports a collision warning or airbag deployment. UBI programs also typically require a telematics device to monitor your driving, while some pay-as-you-go policies require only a mobile app or user-reported mileage.5