Wash. Senator Wants to Give Greater Weight to Mileage in Car Insurance Pricing

State Senator Phil Rockefeller

Sen. Phil Rockefeller has introduced legislation that would require car insurance companies to give low-mileage discounts.

A Washington state senator has introduced a bill that at least would require premium discounts to be given to low-mileage drivers and at most would allow auto insurance companies to issue policies at a per-mile rate.

Sen. Phil Rockefeller introduced the new legislation because Washington law does not currently require insurers to give discounts to drivers who put in low numbers of miles behind the wheel. In addition, the motor vehicle insurance code does not yet address how mileage-based policies should be regulated.

The new bill would change all that.

If the legislation is passed, it would authorize state regulators to “develop and implement a mileage-based insurance demonstration project” in order to provide insight into the different approaches to mileage-based coverage. The commissioner would also be authorized to produce and institute standards that would be used for these types of programs.

This would in theory pave the way for insurers in the state to institute their own mileage-based plans, and any companies failing to do so by July 2012 would be required to give premium discounts to policyholders who drive fewer than 5,000 miles a year.

That July 2012 timeline may prove to be a little tight, though. In California it took years of development before the state’s final legal regulations for pay-as-you-drive policies were set in place.

One hurdle to developing effective regulation of a mileage-based option is the provision of the bill that would allow such coverage plans to be sold in mileage increments rather than in policy periods.

The only insurer that uses a similar method is a Texas auto insurance company called MileMeter, which sells six-month policies in which policyholders purchase between 1,000- and 6,000-mile bundles at a time.

The introduction of Rockefeller’s bill reflects a growing national trend in which lawmakers are advocating for greater availability of pay-as-you-drive programs, which are touted as win-wins because of their potential to cut down on congestion and pollution while also saving money for some consumers.

About Ben Zitney
Benjamin Zitney has been covering the auto insurance industry for the past 2.5 years. Before coming to Online Auto Insurance News, he produced an extensive company history of the 30-year-old California Joint Powers Insurance Authority and worked at the Cal State Long Beach Daily Forty-Niner as a reporter, copy editor and news editor.

2 Responses to “Wash. Senator Wants to Give Greater Weight to Mileage in Car Insurance Pricing”

  1. Thomas Neal
    27. Feb, 2011 at 6:23 pm #

    I am also a Washingtonian. I would like to see this form of car insurance implemented.
    However, I would not want this coverage if the company required me to have a company-installed (and controlled) GPS-type device to monitor the mileage.
    That would let my insurance company know my where-abouts at all times. That is basically an invasion of my privacy.
    There must be a better way.
    Since most odometers are now digital, why couldn’t we take our vehicles to the insurance agent’s office each six months so that they can see the actual mileage during the time period.
    I, for one have owned my car for 3 1/2 years and have driven just of ten thousand miles or about 2500 miles per year, which computes to about 200 miles per month. I am retired.
    This type of a program would also be ideal for the senior citizens who are now paying ridiculous rates and drive their cars very little. My mother is charged $125.00 per month for car insurance, and when she does go somewhere, she usually has me drive her in her car, because she feels more comfortable in her own car.

  2. John Pirro
    28. Feb, 2011 at 11:32 am #


    Chances are that the methods through which insurers in your state would be able to collect mileage data will become more specific and varied by the time that it is made available in your state, if the bill does gain approval. Currently, the legislation mandates for a pilot program to be established so that the actual mileage-based regulation will be determined based on the experiences of the people administering and participating in that program.

    In California, which just recently launched the first pay-as-you-drive programs in the state, it took a number of years to actually develop the final regulations, but the new law allows for a variety of methods for verification beyond using onboard electronic devices, with a portion of them being similar to what you mentioned. They include odometer readings obtained by an employee of the insurer, an automotive repair dealer, a certified smog check center or the insured driver. In addition, part of the California regulation says that insurers, in obtaining mileage data through devices, may not collect and store data about the geographic data of the driver.

    Sen. Rockefeller’s legislation was relatively open-ended, and there will likely be much more specifics added to it as it makes its way through the legislative process.

    As it does take a more defined shape, Online Auto Insurance News will report the updates.

    Thanks for reading.

Comment on this article