Does AAA use telematics? This question is about AAA Insurance

Does AAA use telematics?

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This question is about AAA Insurance

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@WalletHub • 07/26/21 This answer was first published on 07/26/21. For the most current information about a financial product, you should always check and confirm accuracy with the offering financial institution. Editorial and user-generated content is not provided, reviewed or endorsed by any company.

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Yes, AAA uses telematics through AAA Drive, a program that tracks a customer’s driving habits using the AAA mobile app. Customers can sign-up for AAA Drive and receive a discount of up to 30% if they consistently practice safe driving.

What AAA Telematics Tracks

Speed
Acceleration
Braking
Distracted driving
The time of day that you drive

In order to use AAA Drive, drivers need to install the mobile app and enable location services, which will allow the app to automatically log a trip when it detects driving activity. After you start logging trips, the discount will be applied when you renew your policy. You will be able to keep your discount as long as you continue using the program. If you practice bad driving habits while using AAA Drive, AAA will not raise your base premium. But you probably won't get much of a discount, if any. AAA Drive is not available in all states, so check with your regional club to see if you can sign up.

To learn more, check out WalletHub’s guide to usage-based insurance.

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How does telematics insurance work?

Telematics insurance is a type of car insurance that bases your insurance rate on how far and how safely you drive. Insurance companies use telematics to track your driving distances and behavior, and then use that data to assess how much risk the way you drive might pose. This risk assessment is then used to calculate your insurance premium.... read full answer

Your insurance company will provide you a “black box” device that attaches to your car, or an app that you can download to your phone. Both the device and the app then track your driving behavior – including speed, breaking and acceleration, among other factors. The black box device has a SIM card that records your driving information and sends that data back to the insurance company. The phone app uses your car’s GPS capabilities to record data on your driving behavior and sends it back to your insurer.

The company then uses this data to analyze how safe your driving behavior is and calculates your insurance premium accordingly. The safer and less you drive, the more you save.

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How does pay-as-you-go car insurance work?

Pay-as-you-go car insurance calculates a policyholder’s premium based on how many miles they drive each month. The policyholder’s mileage is tracked through a mobile app or device plugged into the vehicle, and customers who drive fewer miles pay a lower rate. Companies that offer pay-as-you-go car insurance, which can also be referred to as pay-per-mile or ... read full answer usage-based coverage, usually charge a monthly base rate and then add a fee for each mile driven.

Pay-as-You-Go Car Insurance Options

Nationwide SmartMiles

Allstate Milewise

Metromile

Other major insurers offer usage-based programs that give drivers a discounted rate based on various driving habits, including miles driven. If your annual mileage is lower than the average driver, you may also qualify for a low-mileage discount.

Who Should Consider Pay-as-You-Go Car Insurance

Pay-as-you-go car insurance is often a good investment for people who don’t drive frequently, like students and seasonal workers. To learn more, check out WalletHub’s guide to usage-based insurance.

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