Best Cheap Low-Mileage Car Insurance for 2023

If you’re like most drivers, you need car insurance. But what if you rarely drive or have a short commute? A low-mileage car insurance policy can help you maintain coverage without paying unnecessarily high premiums. It may be a good option for anyone who works from home, is retired, or uses public transportation or rideshare services often.

Cheapest Low-Mileage Car Insurance

According to our most recent data, drivers across the nation pay an average of $1,394 for low-mileage car insurance policies – defined as 6,000 or fewer miles in our study. USAA offers the lowest representative rate for drivers with low-mileage car insurance. If you’re not eligible for USAA membership, you may want to consider Geico. Its average rates are $308 lower than the national average, and the second lowest in our study. Allstate is the most expensive insurer for low-mileage car insurance, with an average rate that is $911 higher than Geico

USAA$935
Geico$1,086
State Farm$1,149
Nationwide$1,313
Travelers$1,316
American Family$1,323
Progressive$1,519
Farmers$1,904
Allstate$1,997
These are the cheapest companies for low-mileage car insurance

It’s important to remember that low-mileage rates vary and often depend on state insurance regulations. For instance, low-mileage drivers in California may save more than their counterparts in other states. That’s because California law mandates that car insurance companies consider estimated annual mileage costs when setting premiums. The best way to find cheap, low-mileage car insurance is to get free quotes from car insurance companies authorized to sell coverage in your state.

Am I a Low-Mileage Driver?

According to 2020 United States Federal Highway Administration data, the average driver travels just over 14,200 miles per year, roughly 1,183 miles per month. If you drive less than average, you may be considered a low-mileage driver.

The definition of “low-mileage” varies by insurer, as do discounts. If you think you may qualify for a low-mileage discount or incentive program, contact your insurer (or multiple, if you’re shopping around) to find out. Keep in mind that some insurers limit eligibility to drivers who have been policyholders for a certain number of years or hit a certain mileage level.

Is Car Insurance Cheaper If You Drive Less?

There are several variables that play into your auto insurance premiums, including mileage. In general, drivers who spend more time on the road have higher premiums. If you’re driving less, you may be eligible for lower rates. How much you save depends on your driving record, location, insurer, and any low-mileage discounts, plans, or programs available.

According to our data, drivers who clock an average of 6,000 miles annually pay about $48 (3%) less than drivers who average 12,000 miles a year. However, you may be able to further lower your rate with:

  • Low-mileage discounts
  • Usage-based insurance (UBI) programs
  • Pay-per-mile policies

Low-Mileage Car Insurance Discounts

Most car insurance companies offer eligibility-based auto policy discounts, with some extending specific discounts for low-mileage drivers. If you’re not adding a lot of miles to the odometer each year, it’s worth giving your insurer a call to see if they offer discounts to policyholders who drive less than a designated number of miles each year.

Of the insurers included in our rating, USAA, State Farm, and American Family all offer low-mileage discounts that can help you lower your premiums. There are also several other insurers that offer discounts for keeping mileage low, though they didn’t make our Best Car Insurance Companies of 2022 or Cheapest Car Insurance Companies of 2022 ratings. These include Farm Bureau, The Commerce Institute, PEMCO Mutual, and Safeco.

Still not sure if your insurer rewards low mileage? Contact your agent to find out and discuss any other car insurance discounts you can get.

What Is Usage-Based Insurance?

Usage-based auto insurance (UBI) programs use a telematic device or app on your phone to monitor your driving habits. Every program is different, but most car insurance tracking programs base your rate on things like mileage, in-car phone use, braking habits, speeding, and other behaviors that can increase or decrease the risk of an accident.

What Usage-Based Insurance Options Do Low-Mileage Drivers Have?

Many insurance providers, including several in our Cheapest Car Companies of 2022 rating, offer usage-based car insurance options.

CompanyProgram NameDiscount
USAANoblrVaries
GeicoDriveEasyUp to 25%
State FarmDrive Safe & SaveUp to 30%
NationwideSmartRideUp to 40%
American FamilyKnowYourDriveUp to 25%

There are other UBI programs available, including those offered by insurers that aren’t in our ratings. For instance, Liberty Mutual offers up to 30% off as part of their Right Track program. Similarly, Root Insurance indicates that customers can save up to $900 a year by downloading and using a smartphone app that tracks driving data.

It’s important to note that not every usage-based program offers a discount for low-mileage, even if it tracks how far you drive. Before you enroll in a program, find out if mileage is tracked and whether or not it’s factored into your rate. Further, even though a UBI program may lead to lower rates, a discount isn’t guaranteed. Always check with your insurer to find out if your rates may increase based on telemetric device data.

If you’re considering a UBI policy, shopping around and comparing companies can help you find an insurer and program that matches your needs.

What Is Pay-Per-Mile Insurance?

Pay-per-mile insurance is auto coverage that is based on the number of miles you drive. In most cases, pay-per-mile plans also feature a base rate. Total costs vary based on factors such as the type of vehicle, your age, and your driving history. Pay-per-mile policies tend to include full coverage, meaning the policy includes collision, comprehensive, bodily injury, and property damages coverage.

Additionally, many pay-per-mile car insurance plans cap the number of miles that you pay for in a day. Anything after that is free, meaning you can still take road trips without worrying about having to pay a higher premium.

What Pay-Per-Mile Insurance Options Do Low-Mileage Drivers Have?

While several insurers have added usage-based options to their coverage portfolio, fewer offer a true pay-per-mile insurance option. It’s also important to note that pay-per-mile plans are state-limited, so coverage may not always be easy to find. Among the insurers in our rating, only two offer per-per-mile coverage: Allstate and Nationwide.

Allstate’s Milewise charges a daily rate, which is adjusted every six months upon renewal. In addition, drivers also pay a per-mile rate that is adjusted weekly based on driving data from the previous four weeks. Based on Allstate’s projections, drivers who average 1,000 to 10,000 miles a year can save between 20% and 72% on coverage.

Nationwide’s SmartMiles policy operates similarly to Allstate’s per-per-mile policy. Each month, drivers pay their base premium plus a cost-per-miles rate that’s based on mileage from the previous billing cycle. According to Nationwide, the average SmartMiles driver saves 25% compared to traditional policy rates. In addition, SmartMiles drivers may also be eligible for a 10% discount if they practice safe driving habits.

There are other insurers that focus exclusively on pay-per-mile coverage. Both Metromile and Mile Auto offer mileage-based insurance coverage that combines a base rate with a per-mile rate, allowing low-mileage drivers to spend less on auto insurance.

If you’re considering these options, note that they are only available in a handful of states. At the time of publication, Metromile is only available to drivers in Arizona, California, Illinois, New Jersey, Oregon, Pennsylvania, Virginia, and Washington. Mile Auto coverage is only available in Arizona, California, Georgia, Illinois, Ohio, Oregon, and Texas.

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