MileMeter, the only pay-by-the-mile auto insurer in the nation that does not monitor customers with an in-car device, is on the brink of a major expansion. Although the company does not disclose its revenues, it says it now has thousands of customers and has received both bridge funding and a federal grant to extend its outreach and to increase its product offerings.
Founded in 2008, the company has only eight employees and maintains an online presence only. Currently MileMeter is only authorized to write policies in Texas, but hopes to expand to California next year thanks to a new state law that makes pay-by-the-mile insurance legal in the state.
Although this type of coverage has been around for the last decade, it has only recently begun to catch on, with major insurers like Progressive, American Family, and GMAC either offering policies or testing programs. The coverage is now legal in 35 states.
MileMeter is unique in that mileage is verified via customer supplied odometer photos. Coverage amounts of up to 6,000 miles are purchased online as needed, however, the more miles driven, the less competitive the rates. As an example, an allotment of 2,000 miles at the lowest liability level would cost approximately $89.60 for six months.
According to figures compiled by the Brookings Institute, about two-thirds of American households would save $270 a year with this insurance model, which is rapidly coming to be seen as the best way to realistically assess the level of risk per driver.