Does Allstate use telematics? This question is about Allstate

Does Allstate use telematics?

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This question is about Allstate

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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, Allstate uses telematics through Drivewise, its usage-based program, and Milewise, its mileage-based program. Milewise only measures a driver’s mileage in order to calculate a daily rate for their policy, while Drivewise tracks several habits and rewards good drivers with a rebate of up to 25%.

What Allstate Telematics Tracks

Acceleration
Braking
The time of day that you drive

In order to use Drivewise, drivers need to plug the tracking device into their vehicle's OBD port or download the Allstate mobile app, which will automatically log trips when it detects driving activity. After you start logging trips, the rebate will be applied every six months. Because Drivewise gives drivers a rebate instead of a discount, your rate will not go up if you practice bad driving habits while enrolled in the program. Currently, Drivewise is available in all states except California.

Milewise, on the other hand, works a bit differently. Instead of offering a rebate, Allstate uses the program to calculate a driver’s payment based on their daily mileage. Customers are charged a small base premium, and then a fee for each mile that they drive, up to 250 miles per day in some states. As a result, Milewise is a good choice for policyholders who don’t drive often.

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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Does Allstate offer a low mileage discount?

No, Allstate does not offer a specific low mileage discount. Allstate premiums do take mileage into account, however, as rates are an average of 23% lower for customers who drive 7,500 miles annually than for customers who drive 15,000 miles annually, according to WalletHub data. Low mileage drivers usually save on their Allstate premium because less time on the road means a smaller chance of filing a claim.… read full answer

It’s also worth noting that Allstate has a pay-per-mile insurance program called Milewise, which can help low mileage drivers save money. Milewise charges drivers every six months, plus a small fee for each mile driven. Each policyholder’s base rate will be determined based on risk factors like their age, location, driving record, and vehicle.

To learn more, check out WalletHub’s guide to Allstate discounts.

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