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Does my annual mileage affect my car insurance?

Driving a lot or a little could have a considerable impact on your premiums.


Once you start bumping into 12,000 miles in a year, you could see higher car insurance premiums. But if you keep your miles under 8,000, you might qualify for a discount. Not all car insurance companies use mileage as a rating factor, but you might be able to save upwards of 20% by driving less.

How much could I save on car insurance if I’m driving less?

Quite a lot, it turns out. Drivers who cut their annual miles driven from the average of 12,000 a year to 2,400 a year could stand to save $600 a year on their car insurance policy, according to a 2020 report from the Consumer Federation of America. That’a a savings of $50 a month on car insurance premiums, not to mention the savings on gas and maintenance. That’s why it’s worth getting a new quote or shopping around if you’re not driving as much as you used to.

Just make sure you’re still driving your car occasionally to keep it in shape. A car that sits in your garage or driveway for more than a month risks problems with the tires, battery, engine and more.

How mileage affects car insurance rates

Penalties for driving more than average aren’t typically too steep when it comes to car insurance. But you may be able to save quite a lot on your premiums if you stay under a certain amount of miles every year. Each insurance company treats mileage differently, so it’s important to check with your insurer — and any new insurer — to see what its policies are.

How low mileage affects your car insurance rates

For companies that give a low mileage discount, the standard cutoff is around 8,000 miles a year. It’s common for insurance companies to offer a tiered discount for low mileage. For example, driving a car 1,000 annually would result in a greater discount than driving it 7,500 miles.

The discount amount varies by company, but 10% to 20% is the normal range. This discount is applied to the specific vehicle’s rates, meaning it wouldn’t affect another vehicle that drives over 8,000 miles. So you could get the low mileage discount on a convertible you only drive in the summer while the family car takes on all the daily commutes and road trips.

How high mileage affects your car insurance rates

Most companies set base rates for driving between 8,000 and 12,000 miles a year. If you drive more than that, there could be a surcharge added to your rates. This is because there’s a greater chance you’ll be involved in an accident if you’re on the road more.

If a company does apply a surcharge for high mileage, it’s usually a much lower percentage than the low mileage discount. Most insurers will charge in the 5% to 10% range for driving more than you’d expected.

Compare car insurance for low-mileage drivers

Name Product Roadside assistance New car protection Accident forgiveness Safe driver discount Available states
All 50 states
Discover coverage that’s broader than competitors, valuable discounts up to 30% off and perks like shrinking deductibles that reward no claims.
All 50 states
Your dedicated agent can help you find the best savings with multiple discounts and rewards programs.
Liberty Mutual
All 50 states
Earn free accident forgiveness after five years claims-free and customize your policy anytime online at the tap of a button.
Pay only for the miles you drive, plus enjoy app services you won’t find everywhere like claims and car health updates.
Available in 30 states
Track your driving to receive a low rate that reflects your driving skills, and enjoy a fully app-based policy experience.
Motion Auto
Reap a myriad of rewards based on how safe you drive and car safety features, plus free accident forgiveness and diminishing deductible.

Compare up to 4 providers

Why insurers look at mileage to decide your car insurance rates

In the simplest terms: The more you drive, the greater likelihood you’ll get in an accident.

Insurance companies use historical data and predictive modeling to project future losses and accidents. They suggest people who drive more miles have a greater chance of being in an accident. For example, drivers in cities are more likely to get into an accident due to the greater number of cars on the road.

What is predictive modeling?

Predictive modeling is a tool used in analytics and statistics that’s designed to help predict future events or the likelihood of those events. It has existed for a long time and is a natural part of analytics, but its recent application in insurance has evolved alongside more powerful computers.

Predictive modeling in insurance is essentially a set of computer programs that uses as much data as possible to predict future patterns. It looks at what happened in the past and uses that information to determine how likely certain things are to happen — such as how likely it is for cars that have a low annual mileage to get in an accident. Insurance companies then use these results to help determine rates and discounts.

How to get cheap insurance regardless of mileage

If you can’t get the low mileage discount, there are still a few things you can do to lower your insurance premiums:

  • Switch companies. Consider switching to a company that doesn’t use mileage as a rating factor, or switch to one that will reward you for driving less.
  • Change your coverage. If you want to keep comprehensive and collision coverage, you could consider raising your deductibles to at least $1,000. If you have an older vehicle, consider dropping collision coverage. But make sure you still have enough protection to cover costs you can’t afford.
  • Be a defensive driver. Most companies offer a defensive driver discount, which is an easy and worthwhile way to save on your car insurance.
  • Try telematics. If you drive many miles each year, you could still consider enrolling in your company’s telematics program. While mileage is a factor in your score, how fast you accelerate and brake are more heavily rated factors that could earn you a high discount.

Bottom line

Your annual mileage is another factor used by car insurance companies to help set rates, but not all companies use it. You could save up to 20% or more by having a low mileage car. But if you put a lot of miles on your vehicle each year, you may want to consider finding a company that doesn’t use mileage in its rating system.

To find the best rates and discounts for your car, compare different car insurance companies.

Common questions about car insurance and mileage

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