Perhaps sensing a coming trend in the car buying market, auto insurance providers are beginning to offer plans that either reward or encourage drivers who decide to "go green."
One such plan by a California-based insurance company, which touts the plan as the first of its kinds, has introduced an upgrade plan that lets its policyholders upgrade their car to a hybrid model or its equivalent under circumstances where the initial vehicle must be completely replaced. The company offers different variations of the plan that cover the initial vehicle for three or five model years.
Another plan encouraging environmentally friendly driving that has recently been rolled out by a leading insurance provider offers a pay-as-you-drive (PAYD) option that includes the installation of a device that monitors how often the vehicle is used and how reckless the driver is behind the wheel.
Because payments on the PAYD plan are based on how often the car is used, with less frequent use likely resulting in a lower payment, the plan has been seen as having the potential to lower car usage, preventing accidents and lowering emissions in the process.
Along with the rise in popularity of hybrid vehicles, as well as the success of the government's "cash for clunkers" program that encouraged drivers to purchase more efficient vehicles, the prospect of "going green" with a vehicle is easier than ever for consumers. Additionally, the announcement by General Motors on August 12 that the Chevrolet Volt, their first electric car, is capable of getting 230 miles-per-gallon in city driving conditions will likely only spur interest further, forcing auto insurance companies to adjust accordingly.
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Posted: August 12, 2009
