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Driving less may mean paying less for insurance
By Karl Henkel
YOUNGSTOWN
High gas prices have eaten away at disposable income nationwide and has caused 40 percent of drivers to alter their transportation habits.
Despite those cost-saving measures, many drivers aren’t taking full advantage of their newfound transportation lifestyles — and could be passing up additional savings.
According to a new report released by the National Association of Insurance Commissioners, many drivers may be overpaying for insurance.
In fact, in the past year, more than half of Americans have made an economic-driven change that should lower insurance rates. Those changes often go unreported, so those cost-conscious drivers aren’t reaping the benefits.
NAIC President and Iowa Insurance Commissioner Susan Voss said it’s important for drivers to recognize there are long-term savings that compliment the short-term savings on costs such as gas.
“Choices such as driving less, switching jobs or even paying off a vehicle can save — or cost — on your car insurance,” she said.
High gas prices have meant people are driving less, and according to the study, that fact applied to 40 percent of respondents.
The survey pointed out that one in four drivers don’t realize that the number of miles driven annually impacts insurance premiums, though the overall savings is debatable.
The question of the total savings for a reduction in annual miles doesn’t have an easy answer, said Mike Chaney, commissioner of the NAIC’s southeast region.
He said it’s difficult to calculate potential savings because insurance rates are calculated differently depending on the company, and it’s more dependent on where a driver lives than how far he or she is driving.
Chaney said someone living in Trumbull County and working in Youngstown could have drastically different rates than someone living in Youngstown and working in Trumbull County. He said part of the rate determinant even comes down to where a driver parks his or her car: in the driveway or on the street.
Unless there’s a drastic change in miles driven, said Rob Martin, owner of Allstate Insurance, 4613 Mahoning Ave. in Warren, it’s unlikely that aspect alone will save drivers a significant sum.
“Your insurance rate is based more on credit, past driving record, gender, where you live and where you’re driving, more so than total miles driven,” he said.