Motor insurance is compulsory for motor vehicles operating within the national territory. It makes it possible to predict possible damage to vehicles. In the event of a traffic accident, an insurer compensates its member for the damage suffered. Insurance offers can take many forms, from the most basic to the most complex. The terms of the contract are tailored to a specific situation, such as theft, fire or other. This is an insurance that is invoiced on a flat-rate basis according to a specific situation. A new form of insurance is currently being proposed by insurance companies. This is the insurance per kilometre that considers the actual use of a vehicle.
What is a kilometre insurance?
Kilometre insurance is a new form of insurance offered by insurers. It is a concept based on the American system inspired by the slogan “Pay as you drive”, which means “pay according to your conduct”. Unlike other insurance offers, the rate for a kilometre insurance policy varies according to each driver profile and the use of the vehicle. Thus, the payment of insurance contributions is based on the distance travelled by the vehicle.
How to calculate your insurance premiums per kilometre?
The calculation of the contributions relating to the kilometric insurance is based on the use of the vehicle over a well-defined period. The use is justified by the actual kilometres travelled by the car. A mileage report is thus sent to the insurer as a supporting document. In parallel, the insurance company is also installing a geolocation system that monitors the vehicle’s movement in real time. The premium can thus be paid monthly based on the actual distance travelled over the month. A well-defined mileage rate can also be offered to policyholders. The insured will thus have to pay a premium corresponding to a distance predefined in the insurance contract.
The advantages of a per-kilometre insurance
This new form of insurance is advantageous in certain situations. It is suitable for owners of vehicles that only drive occasionally. This is the case for collectors of vintage cars. Per-kilometre insurance is also adapted to different driver profiles, including older and younger drivers. Unlike other drivers, young or retired drivers travel very few kilometres compared to the first category. Thus, an insurance offer per kilometre may be more economically advantageous for them than standard offers.