Why does my car insurance company ask how far I travel to work?

There are many factors that come into play when computing car insurance rates. One of those factors is actually the average number of miles your drive each year.

This factor though not the biggest factor when it comes to determine your car insurance rates definitely plays a part with the relationship between the number of miles and car insurance rates being directly proportional.

Part of the reason that “miles traveled to work” is used to compute your insurance rate is that the longer you are on the road each day, the more chance there is of you getting in an accident. Every minute you are driving is an opportunity for an accident.

The estimated number of miles you drive each year is determined by your driving pattern which includes your “pleasure” miles as well as your work distance. The pleasure distance simply means the average miles you put into your car from using it to go to anywhere that does not include work. This means the distance you travel going to and from the grocery store, the mall, the park, to a restaurant, to pick up the kids, to go on your yearly vacation, and more. Your work distance is much easier to gauge than the pleasure miles since the distance to your work place is fixed, unless you are field worker that goes from location to location.

Things to know before you cancel your car insurance

As mentioned earlier the relationship between the total number of miles and car insurance rates are directly proportional. This means that if you normally use your car for a total of 9,000 miles a year then you can be pretty sure you’re your insurance rates will be lower than if you normally use your car for a total of 15,000 miles per year. It does not necessarily mean though that if you have fewer miles per year than a friend then you’ll automatically have lower car insurance rates. Remember that the rates depend on a number of factors and the other factors just might outweigh the fact that your miles are significantly less than that of your friend’s.

Since pleasure miles are harder to compute for each year the total number of miles each year depends largely on the number of miles you take going to and from work. Hence people who have to take a short commute to work automatically have an advantage as compared to those whose work place is quite a distance off. So aside from the obvious advantages of working in a place near your home, which are shorter travel time and cheaper gas allowance, there’s an additional advantage that most people don’t realize – a lower car insurance rate.