Pay-per-mile car insurance, also called usage-based insurance or Pay-Per-Mile Insurance, charges you based on your actual mileage instead of a fixed annual premium. This flexible premium car insurance model blends a low base rate with a small fee for each mile driven.
It rewards low-mileage drivers: for example, Nationwide notes that if you drive fewer than about 10,000 miles a year, you can save significantly compared to standard coverage. MoneyGeek explains that pay-per-mile is “ideal for low-mileage drivers,” since insurers base your premium on the miles you actually drive. In fact, the average American drives over 14,000 miles per year, so even a modest reduction can unlock mileage discounts. Pay-per-mile programs use telematics and tracking devices to monitor usage, automatically adjusting your bill to fit your driving habits.
With usage-based insurance, every mile counts. Instead of paying a large fixed premium, you pay a base rate plus about $0.02–$0.10 per mile. If you only use your car occasionally, this can make your auto insurance much more affordable than a traditional policy. Below, we explain how pay-per-mile insurance works, who it’s best for, and profile the 10 best pay-per-mile car insurance plans in 2025, each tailored to different needs and driving profiles. Along the way, we’ll sprinkle in key terms like telematics coverage and flexible car insurance premiums to help this guide rank for related searches (as of 2025).
How Pay-Per-Mile Car Insurance Works
Pay-per-mile insurance relies on a tracking method to log your distance. Typically, the insurer provides a small plug-in device (OBD-II) or a smartphone app. These telematics coverage tools automatically record each mile you drive. For example, Nationwide’s SmartMiles offers either an in-car plug or Ford/Lincoln connected car integration, and Allstate’s Milewise uses an OBD-II dongle. Alternatively, some companies (like Mile Auto) send you periodic reminders to upload a photo of your odometer.
Your monthly bill then looks like this:
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Base rate: A fixed monthly fee based on your profile (age, location, vehicle, history).
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Per-mile charge: A small fee (often 2–10¢) multiplied by the miles you drove.
For instance, MoneyGeek gives a concrete example: with a $60 base rate plus $0.10 per mile, driving 1,200 miles costs $180, whereas driving 400 miles costs only $100. Most programs also cap daily charges (e.g., Nationwide caps at 250 miles/day) to protect against unexpected long trips. Each billing cycle, you see a breakdown of base fee, total miles, per-mile fees, and final premium.
Modern usage-based insurance is transparent about costs. You usually get an online dashboard or app to track mileage, review trips, and manage your policy. Lemonade (which acquired Metromile) even plants trees to offset miles driven by policyholders, merging sustainability with savings.
Who Should Consider Pay-Per-Mile Insurance?
Pay-per-mile insurance shines for low-mileage drivers. If you commute by public transit, work from home, or only drive on weekends, you could pay significantly less than with traditional rates. The Zebra confirms it’s best for drivers under about 10,000 miles/year (college students, retirees, remote workers, occasional drivers). Indeed, if you have an average commute of 30 miles or less per day (and safe habits), you might qualify for programs like Progressive’s Snapshot or Travelers’ Intellidrive, which offer discounts of up to 30% for low-risk drivers.
In contrast, if you are a heavy daily commuter (with long-haul drives) or simply rack up high mileage, a pay-per-mile policy may cost more than a flat policy. Also consider whether you’re comfortable with continuous tracking: some plans require consistent odometer uploads or risk penalties.
As one insurance advisor warns, “a potential downside is the extra work of tracking mileage—some companies may even cancel your policy if you fail to send updated pictures of your odometer”. And if you only buy liability-only coverage or need infrequent (e.g., rental) car insurance, services like Hugo (a pay-as-you-go insurer) let you turn coverage on/off by day.
Key Point: Pay-per-mile is for those who drive less and want lower premiums. It can significantly lower costs for cautious, infrequent drivers but may be a poor fit for heavy drivers who won’t benefit from mileage discounts.
1. Nationwide SmartMiles (Best Overall, Statewide Access)
Nationwide’s Pay-Per-Mile Insurance program is widely praised. It’s available in all states except AK, HI, LA, NC, NY, and OK, making it the most widely available pay-per-mile plan. SmartMiles bills every month plus a per-mile fee. It offers perks like a 10% safe-driving discount after renewal and a 250-mile daily cap, so you won’t overpay on the road. Users can track mileage via an OBD-II plug or select Ford/Lincoln connected-car tech.
Nationwide is known for strong customer satisfaction, and MoneyGeek calls SmartMiles “the best insurer” in this space. The program covers all the usual insurance options (liability, collision, comprehensive).. Its mobile app lets you review trips and get alerts. In short, SmartMiles combines national reach with driver-friendly features, earning it a top spot on most experts’ lists.
2. Metromile (Lemonade’s Pay-Per-Mile)
Metromile specializes exclusively in pay-per-mile coverage. Now a part of Lemonade, it’s geared toward tech-savvy, low-mileage drivers. Metromile tracks mileage with a small “Pulse” plug (OBD-II). It charges a monthly fee (starting around $29) plus a per-mile fee (as low as $0.06). If you drive significantly below average, customers report saving hundreds per year compared to traditional rates.
Metromile offers full coverage options and a robust mobile app. The app includes features like street-sweeping alerts, check-engine light diagnostics, and real-time trip tracking. This makes it “the best for those seeking pure pay-per-mile coverage,”. Lemonade notes it has disrupted auto insurance with its data-driven approach and now leverages Metromile’s expertise for its policyholders. If you live in one of Metromile’s serviced states (AZ, CA, IL, NJ, OR, PA, VA, WA) and drive very little, Metromile (via Lemonade) can be hard to beat on.
3. Allstate Milewise (Interactive App, Nationwide Access)
Allstate’s Milewise program is another leading usage-based option. It uses an OBD-II plug or mobile app to track mileage and even provides extensive driving feedback. Allstate charges both a daily base rate and a per-mile rate; interestingly, if you choose the “Unlimited” option, you pay only the daily rate and no per-mile charges.
Milewise is available in many states (AZ, DE, FL, ID, IL, IN, MD, MA, MN, MO, NJ, OH, OK, OR, PA, SC, TX, VA, WA, WV, WI). It offers all common coverages and a suite of app features: you can view trips, safe-driving scores, vehicle diagnostics, and even find nearby mechanics or charging stations for EVs. Allstate includes a pay-as-you-drive discount and frequent user incentives. Experts note that Milewise excels for drivers who appreciate an all-in-one app experience. WalletHub also lists Allstate Milewise among the best pay-per-mile companies.
4. Mile Auto (Odometer Photo, 30–40% Savings)
Mile Auto is a niche insurer focused entirely on low-mileage pay-per-mile coverage. It’s different from others because it doesn’t use a device or app at all – instead, it emails you reminders to snap a photo of your odometer each month. This makes Mile Auto ideal for tech-wary drivers or privacy-focused people, since there’s no constant tracking in the
The company claims drivers save 30–40% off traditional insurance by switching to mileage-based billing. Mile Auto policies offer basic coverage (full and state-minimum) in select states (AZ, FL, GA, OH, OR, TN). There’s no smartphone app, and rates (base + per-mile) are customized per driver. The Zebra notes Mile Auto “markets itself as a champion of privacy” since it avoids plug-ins. If you drive very little and just want the cheapest liability or full coverage policy, Mile Auto is worth comparing (especially if the plug-in hassles put you off).
5. Noblr by USAA (Military-Friendly Usage-Based)
Noblr (pronounced “nobler”) is a newer usage-based insurer that targets military families and tech-savvy drivers. It’s actually backed by USAA. Noblr uses only your Pay-Per-Mile Insurance (accelerometer, GPS) to track driving behavior and mileage. You simply download the app—no device needed—and it monitors trips in the background. Premiums consist of a fixed base rate plus a variable rate that factors in mileage and safe driving.
Noblr is available in several states, including AZ, CO, LA, MD, NM, OH, PA, and TX. It offers all standard coverages and provides an engaging app (scorecards, feedback, community features). Importantly, Noblr’s program can benefit those who park their car for months (say, during deployment or remote service) by charging low per-mile rates only when the car is in use. WalletHub specifically highlights “Noblr by USAA” among the best pay-per-mile. For military members and their families, Noblr can be an excellent way to save if your car sits idle much of the year.
6. Lemonade (Insurtech App with Pay-Per-Mile)
Lemonade is known for its AI-driven, fully digital insurance. While not exclusively mileage-based, its car insurance program has strong usage-based elements. In 2022, Lemonade acquired Metromile to enter auto insurance and now offers pay-per-mile-style policies in the states where Metromile was active. The Lemonade app tracks both mileage and driving behavior (like braking and acceleration) to give safe drivers lower rates.
Leveraging Metromile means Lemonade can offer a pay-per-mile or usage-driven option. It doesn’t list flat rates publicly, but emphasizes convenience and sustainability: drivers of electric/hybrid vehicles get additional discounts. If you’re looking for a fully online quoting and claims experience, Lemonade could be a fit. Its app lets you manage everything from sign-up to roadside assistance. In summary, Lemonade is ideal for younger, tech-savvy drivers who value streamlined digital service and may drive infrequently.
7. Root Insurance (Usage-Based Safe Driving)
Root pioneered smartphone-based, usage-based auto insurance. While Root’s pricing isn’t strictly per-mile, it’s close: premiums drop dramatically for safe, low-mileage drivers. Root tracks your driving via its app over a trial period. Good drivers (no hard braking or fast speeds) can see large discounts. According to Root allows you to “save up to $900” by switching if you have good driving habits.
Root is available in most states (exclusions include WA, ID, WY, SD, etc). It includes roadside assistance in all policies and operates entirely by app (quote, buy, and manage by smartphone). If you’re a cautious driver who already drives little, Root’s personalized rates may beat standard insurers. It’s worth a quote, especially if you don’t mind letting an app monitor your every move.
8. Hugo Insurance (Liability-Only Pay-As-You-Go)
Hugo takes a different approach: micro-duration coverage. It isn’t pay-per-mile per se, but it’s a flexible auto plan for sporadic drivers. You turn Hugo “on” only for the days you need to drive (like per-trip or per-day liability insurance). There’s no device or tracking, just simple daily pricing. For instance, Hugo’s basic plan offers liability coverage for as little as $8/day in some states.
This model appeals if you don’t drive regularly and can risk going without full coverage on parked days. The coverage is mostly liability-only (with a flexible plan or full coverage upgrade available). Underwriters cite its convenience: no down payment, easy day-by-day payments, and instant proof of insurance. Hugo isn’t a full-coverage car insurer, but it ranks as a top “pay-as-you-go” solution, especially for those who use their car very infrequently.
9. Progressive Snapshot (Discount for Low Mileage)
Progressive’s Snapshot program isn’t sold as pay-per-mile, but it deserves mention. Snapshot uses a plug-in device or app to track mileage, driving time, and braking. It then applies a usage-based discount (customers average $150 yearly savings). Importantly for this topic, Snapshot rewards low mileage along with safe driving. An Advantage Insurance Network blog notes that Snapshot measures your miles and driving habits, automatically giving discounts up to 30%.
Because Progressive is one of the nation’s largest insurers, any savings here can be significant. If you already have a Progressive policy, adding Snapshot can lower your premium when you drive less. It’s a simpler option if you like Progressive but want some usage-based benefit.
10. Travelers IntelliDrive (Low-Mileage Discount Program)
Like Progressive, Travelers doesn’t offer pure pay-per-mile plans, but its IntelliDrive (formerly Strides) program offers hefty discounts for low-mileage drivers. According to Travelers, if you drive under 13,000 miles/year, you can save up to 30% The program uses a smartphone app to verify miles driven. A 10% one-time discount is applied just for enrolling, and you earn more savings as you maintain low mileage.
This isn’t a pay-per-mile billing system, but it effectively makes insurance cheaper as you drive less. Travelers’ millions of policyholders can take advantage by adding IntelliDrive and monitoring their driving in the app. If you expect to put a few miles on your car (say, a commuter or retiree), IntelliDrive is an easy way to capture mileage discounts.
Is Pay-Per-Mile Insurance Right for You?
Before switching, compare multiple insurers and run the numbers. Pay-per-mile can save 20–40% or more for very low mileage, but costs can rise if you drive more. A good rule: if you drive less than the national average (~14k mi/year) and can stay consistently low, you’ll likely save. WalletHub notes that pay-per-mile is offered by a “few companies,” so shop around at
Key questions to ask:
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How many miles do I drive? (Estimate weekly/monthly miles.)
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Is my car eligible? (Most require 1996+ models.)
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Am I comfortable with tracking? (Plug-in, app, or odometer uploads.)
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What coverage do I need? (Some pay-per-mile insurers limit options.)
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Which state do I live in? (Not all programs are nationwide.)
One easy step is to get quotes or trial periods from the top providers above. Many have zero-obligation sign-ups or easy policy switching.
Quick Tip: Always look for a mileage cap (most caps ~150–250 miles/day) to avoid surprise charges on road trips. Also, check if there’s a multi-car discount if you insure more than one vehicle with the program.
FAQs: Pay-Per-Mile Insurance
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Q: What is pay-per-mile car insurance?
A: It’s a form of usage-based insurance where your premium is based on miles driven. You pay a fixed base rate plus a small per-mile fee. Unlike traditional insurance (which assumes fixed annual mileage), this plan adjusts your bill each month to match actual driving. -
Q: How is it different from usage-based or telematics insurance?
A: Pay-per-mile focuses solely on mileage. Telematics (or usage-based) insurance often also tracks how you drive (speed, braking, time of day). In other words, pay-per-mile ignores driving behavior; your bill depends only on distancewhereas telematics programs can raise or lower rates based on driving habits. -
Q: Do I still get full coverage?
A: Yes. Pay-per-mile policies include the same coverages (liability, collision, comprehensive) as normal auto insurance. You just pay differently. For example, Nationwide SmartMiles and Allstate Milewise both offer full-coverage auto insurance with pay-per-mile pricing. -
Q: What if I forget to upload my odometer or plug in the device?
A: This can be an issue. Insurers typically bill you as usual if they lack mileage data. Some have warned that “failing to send updated pictures of your odometer” when required might even lead to policy cancellation. Always set reminders for odometer checks or keep the app/device connected to avoid penalties. -
Q: Are there mileage discounts?
A: Yes. The entire model is based on mileage discounts—drive fewer miles, pay less. For example, Travelers offers up to 30% off for driving under 13,000 miles/, and Progressive’s Snapshot averages $150/year savings for safe, low-mileage driving. Many insurers also cap daily miles (often ~250 mi), so you won’t pay more even on long trips. -
Q: Can I switch back to regular insurance later?
A: Yes. Most companies let you cancel usage-based plans anytime and return to standard policies. It’s wise to review your driving habits each year. If your mileage exceeds the break-even point, a traditional plan may be more cost-effective. Always compare quotes. -
Q: How do I get pay-per-mile insurance?
A: Contact the insurers above (either via their websites or an agent) to request a pay-per-mile policy. You typically need a qualifying car (post-1996) and a compatible smartphone. Many sites (like MoneyGeek or The Zebra) offer quote comparison tools you can use first.
If you have further questions about how these programs work, please ask in the comments below or refer to each insurer’s FAQ. For example, see The Zebra’s guide to pay-per-mile, which offers detailed answers on these.
Ready to save on car insurance? Compare quotes from multiple top companies and see how low your premium can go. If you found this guide helpful, share it with friends or family who drive little. Your question or experience with pay-per-mile insurance might help others—feel free to leave a comment below!
