Low mileage car insurance

Lower annual mileage means cheaper car insurance. But get it right - underestimating how far you travel could be costly.

Amanda Bathory-Griffiths

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Low mileage drivers are a low risk

You’ll be asked for your estimated annual mileage when you get car insurance quote.

The higher your mileage, the more time you spend on the road. This’ll make your insurance more expensive because insurers think you’re more likely to be in an accident.

If you’re not on the road as much you’re less likely to be in an accident, so insurers can offer you cheaper cover.

Key points

  • Your car insurance is calculated based on your annual mileage, as well as a host of other factors
  • If your mileage is very low, a pay-as-you-go, or on demand insurance policy could be cheaper
  • Be honest about your mileage or you could invalidate your insurance

Who has a low mileage?

You’ll might have a low mileage if you:

  • Live in a multi-car household, and one car is driven more regularly than the other
  • Lift share with colleagues or friends
  • Are a student and you leave your car at home during term time
  • Have a classic car and only use it a handful of times during the year

Two ways to calculate your mileage

  • If your mileage is roughly the same as last year, check your MOT certificate or service record, both of which will have a note of your mileage
  • New car, change in routine, or a longer commute? Roughly calculate your weekly mileage and multiply it by 52 to get a yearly figure

What’s considered low mileage?

The average annual mileage for a car is 7,134 miles - so anything less can be considered low mileage[1]

Misleading mileage

There are other factors used to calculate your insurance, so fewer miles on the clock won’t automatically cut the cost of your car insurance.

It’s impossible for you to know exactly how much ground you’ll cover in the next 12 months, and insurers are usually relaxed if your estimate is slightly off - but you should tell them immediately if you realise you’re going to go significantly over your estimate for the year. They may need to recalculate your premium.

This works both ways. If you reduce your mileage during your policy, let your insurer know and they might reduce the cost of your insurance. There may be admin fees for making the change though, which could cancel out any savings.

Always be honest and as accurate as you can about mileage. If you make a claim, the insurer will want your estimated mileage and the actual mileage to tally up, and if it’s significantly off your insurance could be invalidated.

Should you get legal expenses cover?

Disadvantages

The main problem with legal cover is that there is no guarantee you'll win your case - or even that the case will be taken up by a lawyer in the first place.

The chances of success will be assessed as the case goes along, and the funding can stop at any time - if new evidence emerges, for example.

Advantages

Some people use their savings to cover any legal claims they need to make, or to pay off any claims made against them. But legal costs can quickly add up and you might be looking at a significant sum.

Legal expenses cover will give you peace of mind, and it often includes access to a free legal helpline for valuable advice following a car accident.

Types of low mileage policy

If it’s renewal time, you can compare different types of car insurance aimed at low mileage drivers.

Telematics

Have your car fitted with a black box, also known as telematics technology, and take advantage of a GPS tracking system that tracks your driving habits. It helps the insurer calculate how much your premium should be.

If you stick within your agreed mileage limit the insurer will normally offer you a discount or ‘free’ additional miles to use each month or quarter.

Pay-as-you-go insurance

Just like a pay-as-you-go mobile phone contract, pay-as-you-go insurance only covers for the miles you actually need.

You’ll pay a flat fee each month and pay extra for each journey you take, or you’ll be charged on an hourly basis.

Your mileage is monitored by having a black box fitted to your car, or through an app on your phone.

Short-term car insurance

If you’re only driving for short stints every now and then, compare the cost of a short-term policy versus annual car insurance and see if that has the right level of cover at the right price.

Classic car insurance

Only use your vintage car a few times a year? It’s worth looking into specialist classic car insurance.

It accounts for the true value of your restored car, and lower mileage.

Some policies have limited mileage clauses, where you make a declaration of your mileage - you’re not allowed to exceed this without telling the insurer first.

Car insurance guides and tools

[1]According to the Department of Transport in 2017

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