Compare the best usage-based auto insurance quotes for free.

Simply put, UBI auto insurance is a great way to obtain cheaper car insurance for your vehicle. Also known as pay as you drive insurance, you pay for the kind of driving you actually do, instead of the driving the insurance company thinks you do. And if you're a careful driver, your premiums will reflect that.

And there's another benefit: you get instant feedback on your driving habits. Many insurance companies have apps that give you real-time insights into how you drive and share recommendations on how you can become a better driver.

Recent studies also show that telematics technology really does make for safer driving. One report analyzed over 200 million miles of data collected from young drivers since 2011.

Some very promising trends emerged: for instance, the report showed a 40% drop in crash risk for new drivers with usage-based insurance compared to young drivers without a UBI insurance policy.

Not surprisingly, 80% of UBI customers agreed that technology helped them become better drivers, and many said they began to monitor their behaviour behind the wheel in an effort to reduce their premiums.

All in all, pay as you go car insurance policies can save lives and keep the cost of insuring your vehicle to a minimum.

Traditionally, insurance companies use very blunt methods to calculate car insurance rates. Demographic data, like age and gender, combined with a driver's past record (number of years on the road, number of traffic violations and claims, etc.) were the only ways an insurance company could gauge how risky a driver was on the road.

But pay per use auto insurance plans use your real-world driving data to determine if you're a safer bet than other drivers with the same basic profile.

The first step is installing a little black box into a diagnostic port on your car (usually near the steering column). The unit is about the size of a matchbox, and it collects data on your driving habits and then transmits the data through cell phone networks and back to your insurance company.

Once your insurance company has the data, it can adjust your premiums accordingly. Remember: safe, cautious driving equals cheaper car insurance.

Pay-per-use car insurance customers usually see a savings of 10% to 25% on their yearly premiums. Drivers who fall into traditional high-risk categories (inexperienced drivers, drivers in big cities, etc.) can save even more.

In Quebec, Ontario, and Alberta, surcharges can be added to your premiums if you're classified as a riskier driver based on the data collected from your car insurance monitoring device.

There’s no single company that offers the cheapest UBI car insurance. Each insurance company calculates its pay as you drive car insurance rate discounts differently.

It’s best practice to compare usage-based car insurance online. Our auto insurance quoter allows you to compare UBI car insurance quotes from multiple providers which ensures you’re getting the best pay-per-mile car insurance available.

No. Each insurance company calculates its UBI rate discounts differently. For example, some assign more importance to speed and acceleration than to other variables. Others place greater weight on when you drive. It just depends on the insurance company. Compare quotes online for the best UBI car insurance rates.

In Canada, pay per mile insurance is widely available in Quebec, Ontario, New Brunswick, Nova Scotia, Alberta, and P.E.I. Meanwhile, Saskatchewan hasn’t made any further announcements about integrating a UBI program since its pilot program for motorcycle drivers ended in 2014.

British Columbia is taking a "wait and see" approach to UBI due to some of the privacy concerns posed by the technology. Manitoba and Newfoundland and Labrador haven't made announcements about their own plans for introducing UBI — at least, not yet. UBI is a newer insurance option in Canada and provincial governments are still working out the kinks to ensure that it can be implemented safely and ethically.

Check LowestRates.ca to find out when UBI becomes available in your area.

Last updated: Nov. 8, 2021

Contact us at info@lowestrates.ca and we'll connect you with a usage-based insurance expert to review your pay as you drive insurance options.