Car insurance is a big expense for most drivers, but what if you don’t drive much? If you only use your car occasionally—whether for short commutes, running errands, or weekend trips—you may qualify for low-mileage car insurance, which can help you save money each year.
Many insurance companies offer discounts or special programs for people who drive less than the national average. The trick is knowing which insurers provide the best value and what type of policy fits your lifestyle.
Why Mileage Matters in Car Insurance
Insurance companies calculate risk based on how often you are on the road. The more miles you drive, the more likely you are to be in an accident, which increases your risk profile. On the other hand, if you drive less, insurers may see you as a lower risk and reward you with lower premiums.
According to the Federal Highway Administration (FHWA), the average American drives about 13,476 miles per year. If you drive less than this, you’re typically considered a low-mileage driver.
Key Takeaways for Low-Mileage Drivers
- Low-mileage drivers save about $85 annually compared to high-mileage drivers.
- Options for savings include discounts, pay-per-mile insurance, and usage-based programs.
- Comparing multiple quotes is the most effective way to secure the cheapest policy.
- The best insurance for you depends on your driving habits, location, and comfort with driver-tracking technology.
Cheapest Car Insurance Companies for Low-Mileage Drivers
Based on data from 2025, here are some of the most affordable insurers for drivers averaging 7,000 miles per year:
- American National – $891 annually
- USAA – $1,198 (available to military members, veterans, and their families)
- Root – $1,394 (app-based insurance that monitors your driving habits)
- Travelers – $1,445
Other companies with below-average rates include Geico, Country Financial, Auto-Owners, Progressive, and The Hartford.
💡 Tip: Rates can vary by state, age, and driving record. Always compare at least 3–5 quotes before deciding.
Types of Low-Mileage Car Insurance
There are several ways to save if you don’t drive much. Here’s a breakdown:
1. Low-Mileage Discounts
Some insurers offer direct discounts if you drive below a set annual mileage limit, often between 7,000 and 10,000 miles. These discounts vary, but they can reduce your premium by 5–10%.
2. Pay-Per-Mile Insurance
Also called pay-as-you-go insurance, this type charges you a base monthly fee plus a cost per mile driven.
- Best for: retirees, remote workers, students, or people who mainly use public transportation.
- Example: If your base rate is $40 per month and your per-mile rate is 5 cents, driving 500 miles would cost you $65 that month.
Popular options include:
- Allstate’s Milewise
- Nationwide’s SmartMiles
- Lemonade (Metromile)
- Mile Auto
- Noblr (USAA)
📌 This option can be cost-effective if you typically drive fewer than 8,000–10,000 miles per year.
3. Usage-Based Insurance (UBI)
UBI programs track your driving habits through a mobile app or a plug-in device. Factors that may be monitored include:
- Hard braking
- Speeding
- Phone use while driving
- Night-time driving
Safe drivers can earn discounts of up to 30%, but risky driving may increase your premium.
Who Benefits Most From Low-Mileage Insurance?
Low-mileage insurance isn’t for everyone, but it’s especially useful if you:
- Work from home and rarely commute
- Are retired and only drive locally
- Use public transport for daily travel
- Own multiple cars but drive one less frequently
- Live in a city where walking or biking is common
Pros and Cons of Low-Mileage Car Insurance
✅ Advantages
- Lower premiums if you drive less
- Flexible pay-per-mile options for occasional drivers
- Safe driving rewards through usage-based programs
❌ Disadvantages
- Not available in all states
- Tracking programs may feel invasive
- Costs can rise quickly if your mileage increases
FAQs
1. Is car insurance always cheaper if I drive less?
Not always. While many insurers offer discounts, some may not reduce rates significantly. That’s why comparing multiple quotes is crucial.
2. Should I choose pay-per-mile insurance?
Yes, if you consistently drive fewer than 8,000 miles per year. But if you take long road trips often, a traditional plan may be cheaper.
3. Is usage-based insurance worth it?
It can be, especially for safe and careful drivers. However, you should review what data the company tracks before signing up.
Final Thoughts
Low-mileage car insurance can be a smart way to save money if you don’t drive often. Whether through a low-mileage discount, a pay-per-mile plan, or a usage-based program, there are multiple options to explore.
The key is to:
- Understand your driving habits (track your yearly mileage).
- Compare quotes from different insurers.
- Choose the plan that best matches your lifestyle.
By tailoring your coverage to how much you actually drive, you could save hundreds of dollars each year without sacrificing protection.