Updated: Sep 27, 2021
There are five basic things that you need to know about UBI because it is available for everyone and it totally depends on you.
Paying for insurance can be one painful expense. You never want to use your insurance but you are definitely glad that it is there. With that, this article aims to provide you with information on usage based insurance and why it is a good idea for you to get one.
1. Usage Based Insurance (UBI) is an option available for everyone
A usage based insurance (UBI) is a kind of insurance option that is offered by insurance providers which tracks your driving skills and aims to look at your driving scores. If you have a good driving record, it could result in lower car insurance rates.
2. UBI takes into account the totality of your driving records
Licensed and insured drivers who have good driving records can enjoy the UBI option. It generally includes measures of speeding, harsh braking, mileage, time of the day you drive, acceleration records, and every driving score that you may have. Generally, the better driver you are, the better rates may be given to you.
3. UBI may use cumulative driving data
Accumulated driving data is one of the best ways to get an idea of how much your UBI can be. Some cars already use technology that tracks driving data. Some drivers also make use of systems that are required by their insurance providers in order for them to track the driving data such as the car’s on-board diagnostics (OBD-II) port, through a smartphone application, through a device called a tag that is installed in the windshield or the rear window like a go pro dashcam, or through any other means that are allowed by the insurance company.
4. Driving points stay in your license for different periods
How long do points stay in your license?
If you are already considering UBI, and you have points in your license, you will not be glad to know that points stay in your license between one year to ten years, depending on the severity of the traffic violation.
For moving violations, the points often stay for a period of three years from the date of the offense. For violations that caused body damage and at fault violations, the points will stay in your license for three years from the date of the offense.
If your points are caused by driving under the influence, the points will stay on your license for a period of 10 years.
5. Driving points does not always mean an increase in insurance premiums
Once you get some driving points, it does not necessarily mean that there would be an increase in the insurance premiums, even with the UBI. Insurance companies have different appreciation on driving points.
For example, a simple driving while texting may be an additional $75 in one company while the same driving points may only be a $25 addition. Look at the different options available before fully committing to an insurance provider.
Insurance Providers Should Explain The Premiums
Before signing the dotted line, make sure that you get your insurance company to explain any additions or changes to your insurance policy. If you think that a UBI is not the best option for you, there are still different kinds of insurance that will cover your motor vehicle. Just check the type coverage calculator on a potential insurance provider.