If you drive little (retired, regular user of public transport, young driver), insurance per kilometer saves money compared to a conventional insurance contract.
In practice, there are two types of car insurance per km: insurance “to the nearest km” and the mileage package.
The insurance “to the nearest km” is calculated according to the actual use of the vehicle; a connected box is installed in the car and records the journeys made and sends a precise statement to the insurer each month, who will adjust the bill.
A relatively flexible formula
By choosing a mileage package, the insured agrees not to exceed a previously fixed ceiling; a ceiling which he chooses himself according to his needs and which is mentioned in the contract.
The insurer, for its part, applies the principle of trust: thus, the mileage is not systematically checked each year and can be reduced to a declaration on honor or the sending of the photo of the odometer as well as the registration plate. With other insurers, a mileage check is carried out.
A variable geometry mileage package
According to the insurers, the mileage package is changing; at Axa, you have the choice between 7,000 km or 9,000 km; at Assu 2000, the choice is limited to less than 4,000 km or less than 8,000 km.
At Groupama, you must drive less than 8,000 km but, to calculate your premium, most insurers use predefined premium brackets and scales, from 6,000 km, 7,000 km, 8,000 km up to 15,000 or 20,000km.
In all cases, you choose your level of cover between Third Party, Extended Third Party or All Risks.
Watch out for the ceiling
Be careful with the ceiling you choose; it is better to overestimate at the beginning because the insurer can reimburse the kilometers not carried out or carry them over to the following year as a kitty.
If you very slightly exceed the ceiling, you will not be held responsible for this, but if you go beyond the ceiling, the insurer will restore the price conditions of a classic contract and you will lose your reduction.
But the penalty can be much worse; you risk an increase in the deductible or a reduction in coverage from your insurer in the event of an accident.
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