Pay as you go insurance may be a cheaper way to insure your car if you drive very few miles, or if you're a new or young driver battling expensive premiums.
Pay as you go (PAYG) car insurance ask you to pay a fixed annual or monthly rate, plus a charge per mile or hour you drive.
If you don’t drive your car at all, the fixed rate is all you pay, but you may want to register the car as off the road (SORN) instead.
Pay as you go insurance is usually a rolling contract, so you can cancel the policy at any time without being charged a fee, but it’s worth checking your policy to be sure.
You may need to fit a tracker, or a black box, to your car via the onboard diagnostics (OBD-II) socket, which is a standard feature for all cars made after 2002.
Some insurers might cover the basics of fire, vandalism, theft and accidental damage while it’s not in use and then provide comprehensive cover when you’re driving around.
Other insurers will offer one level of cover for the whole of your policy, whether the car is parked or not. We’d suggest asking your insurer to clarify what you’re covered for and when.
If you stay with a pay as you go policy for one year, you’ll start to build up your no claims discount, just like with regular car insurance