Pay As You Drive
The insurance industry keeps evolving to cater to the varying needs of customers. The evolution of insurance purchases from traditional purchases to a digital mode of purchase has brought about a big transformation in the insurance industry.
The newest transformation in the Motor Insurance space in India has been the introduction of ‘Pay As You Drive’ insurance, which has already been proven to be very successful in foreign countries.
While some insurers name this policy as ‘Pay As You Drive’ Insurance, others call it ‘Pay As You Go’ / ‘Pay As You Use’ / ‘Pay Per km’ Insurance.
Read on to know all about Pay As You Drive car insurance.
- Save upto 75%*Lowest Car Premiums
- 45 Lakh+Happy Customers
- Claim Support7 days a week**
What is Pay As You Drive Car Insurance?
If you travel fewer km than the average citizen, why should your premium be the same? Introducing Pay As You Drive Car Insurance - The insurance made exactly for your usage, You Pay As Per Your Use.
Calculate Your Car Insurance Premium Online
Select your car brand
Which city is your car registered in?
When did you buy your car?
If your car usage is low then so should be your premium.
Pay As You Drive car insurance is a new type of car insurance policy that enables you to customize your insurance policy as per your travel usage, thus helping you reduce and optimize your premium.
Pay As You Drive policy requires you to declare your usage i.e. the number of kilometres the vehicle would be running in a policy year.
The premium payable for this insurance is decided based on the kilometres covered.
How does Pay As You Drive Car Insurance work?
Pay As You Drive car insurance works similarly to a regular car insurance policy. However, the only difference is that the own damage cover is available only till the maximum number of kilometres is opted for under the plan.
When buying the Pay As You Drive plan, the policyholder has to do the following -
Declare Car Usages
Firstly you need to declare the car usage for the policy period (which is of 1 year) based on the different kilometres slabs provided by the insurer
Based on the insurer to insurer, you will either be required to upload a video or a photo to declare the odometer reading of your car before the policy expiry date.
In some cases, you might be required to take a video or a photo of the vehicle number and chassis number
Pay As You Drive plan is based on the declaration of the customer and no telematics device will be installed in the car.
Depending on the various km usage slabs provided by the insurer, you can receive discounts on your own damage insurance premium.
The premium for the Pay As You Drive policy is decided based on the number of kilometres your car will be driven in the following year. You can choose from the insurance company’s distance travel slab and make an informed decision regarding distance travelled vs. premium charged. Given below are the slabs as samples -
Below 2,500 km
More than 2,500 km but less than 5,000 kms
More than 5,000 kms but less than 7,500 kms
More than 7,500 kms but less than 10,000 kms
More than 10,000 kms
The higher the slab you choose, higher will be the premium and vice versa. If you feel that your car will cover a distance of 4,000 kms in a policy year, then opting for below ‘More than 2,500 kms but less than 5,000 kms’ slab would be the right choice as it will help you save money.
Additionally, if anytime during the policy period, you feel that the km limit you mentioned in the policy will get exhausted then you can further top up the kms. However, before deciding on the kms, please check on the policy terms and conditions.
Your claim will be processed as normal if your km usage is within the km slab bought by you at the time of policy buying. However, if your claim comes post exhaustion of the km limit then you may be asked to pay a certain amount at the time of claim in the form of a co-payment.
Pay As You Drive Insurance Eligibility
When purchasing a Pay As You Drive policy for your car, you need to keep certain points in mind such as the Type of Car you drive, the km you would be covered in a year, the Previous Year Claim status, etc. Given below are a few parameters which few insurers take into consideration before issuing Pay As You Drive policy to you -
Non Premium cars
Pay As You Drive policy is applicable on those cars where the original price of the car is less than 30-40L, again depending on the insurer to insurer.
Kms you would drive in a year
Though this is not a stringent requirement, you need to inform the insurance company about tentative kms you would be covered in a year.
For instance: Digit insurance has a strict requirement around Pay As You Drive policy to be given to users whose avg. yearly usage < 15,000 km per year
Previous Year No-Claim Bonus
While this factor is again not a strict requirement for many insurers, some insurers do have a requirement around NCB > 0% However, some insurers on a case-to-case basis allow Pay As You Drive policy issuance if there's no claim in the last year along with NCB = 0%.
Also, claiming in the previous year might make you ineligible to avail Pay As You Drive coverage.
Some insurers do take into account used cars/ownership transfer cases while checking eligibility for Pay As You Drive
Things to know about Pay As You Drive insurance cover
Here are a few important highlights of the Pay As You Drive insurance coverage that you should know about.
Regarding the purchase of the policy:
Currently, not all insurance companies are offering this type of policy. To purchase this type of insurance, you have to do some basic research online or get in touch with your insurance provider. Based on the service offered by the insurance company, you can purchase the plan either online or offline.
The following information has to be submitted to the insurance company at the time of policy purchase.
Chassis number, in some insurers
Complete car details such as make and model, date of registration, etc.
KYC details and other documents as required by the insurer
Things to keep in mind when purchasing Pay As You Drive car insurance cover
Car usage varies for different kinds of users. While the frequency of usage for some people is higher, the frequency for some people might be very low. Hence to allow customers to pay optimal premiums based on their actual usage, the Pay As You Drive Car Insurance has been designed for the following type of users -
In case you own multiple cars and then the Pay As You Drive plan is recommended for the car having lower usage (less than 10-15k kms per year)
Usage of the vehicle
If you live in a Tier 3 city and beyond, and your yearly usage is less than 10-15 kms per year, then the Pay As You Drive cover is the right plan for you.
If you mostly commute through public transport and rarely use your car, then the Pay As You Drive cover is the right plan for you.
If you have to travel out of the station regularly and are unable to use your car a lot, then the Pay As You Drive cover is the right plan for you.
Based on the usage of the car, you should go for the different Pay As You Drive slabs such as 2,500 kms / 5,000 kms / 7,500 kms / 10,000 kms / 15,000 kms. But in case you exhaust the kms on your base plan, you can always top up with 2,500 kms / 5,000 kms / 7,500 kms / 10,000 kms
Features of Pay As You Drive Car Insurance
Given below are few of the features of Pay As You Drive Insurance Policy
The tenure for Pay As You Drive policy is one year
The policy can be customized by adding various add on covers by paying additional premium
The own damage premium is decided based on the usage i.e. the slab of the kilometers covered
What is covered under Pay As You Drive Car Insurance?
Pay As You Drive insurance provides coverage in case of the following:
Damages caused due to road accident
Damages caused due to man-made or natural calamities
Damages caused due to fire and explosion
What is not covered under Pay As You Drive insurance?
Coverage under Pay As You Drive insurance is not provided in the case of the below:
Damages caused when driving under the influence of alcohol
Damages caused when driving without a valid driving license
Regular vehicle wear and tear
Mechanical or electrical breakdown of the vehicle
How to buy Pay As You Drive car insurance?
Given below is a very simple process to purchase Pay As You Drive policy for your car. The process might vary depending on the insurance company you choose.
Research on the insurance companies that offer Pay As You Drive
Read about the features, inclusions and exclusions of the policy
Enter your basic details
Enter details about your car
Declare the right information about your car
Submit basic documents such as your identity proof, address proof, etc
Declare the kilometers you plan to cover in a policy year
Select the right km slab along with the add-on covers offered
Upload the Odometer Reading (picture/video) along with some images such as the Vehicle number and Chassis number
Proceed with making the payment
Download the car insurance policy that you receive on your registered email address
Difference between Pay As You Drive car insurance and comprehensive car insurance
Confused between choosing Pay As You Drive cover or comprehensive car insurance cover for your car? Read about the difference between the two.
Comprehensive vs Pay As You Drive
Car Insurance for Popular Car Models
- *Premium Starting from ₹8,416
- *Premium Starting from ₹12,824
- *Premium Starting from ₹10,425
- *Premium Starting from ₹7,685
- *Premium Starting from ₹17,242
- *Premium Starting from ₹11,243
- *Premium Starting from ₹13,827
- *Premium Starting from ₹18,931
- *Premium Starting from ₹11,878
- *Premium Starting from ₹92,146
- *Premium Starting from ₹27,981
- *Premium Starting from ₹37,097
- *Premium Starting from ₹12,339
- *Premium Starting from ₹17,429
- *Premium Starting from ₹109,953
- *Premium Starting from ₹52,679
- *Premium Starting from ₹62,782
- *Premium Starting from ₹119,126
- *Premium Starting from ₹128,979
- *Premium Starting from ₹105,087
Car Insurance Add-ons
Car Insurance By Popular Car Manufacturers
Car Insurance Companies Reviews & Ratings
I desired to know about network garages and services available for the customer under the network garages as...Read More
I purchased the Bajaj Allianz Car Insurance Policy for my MG Hector car from InsuranceDekho. InsuranceDekho’...Read More
I wanted to know some claim-related information for my HDFC Ergo Car Insurance Policy that I purchased for m...Read More
I wanted to renew my car insurance policy. I visited InsuranceDekho’s website. I renewed my Tata AIG Car Insur...Read More
Thanks to InsuranceDekho for allowing numerous payment options. This gave me the freedom to choose my credit...Read More
FAQs related to Pay As You Drive insurance
When was Pay As You Drive cover introduced?The Pay As You Drive insurance cover was introduced in the year July 2022 by the Insurance Regulatory and Development Authority of India
Does Pay As You Drive cover provide coverage for third party damages?Yes, Pay As You Drive insurance cover does offer coverage for third party damages
What is Pay As You Drive in car insurance?Pay as you go in car insurance is a non-telematics based car insurance plan that insures your car depending on the usage i.e. the kms you cover and declare yourself.
Does Pay As You Drive cover vehicle theft?Yes, vehicle theft is covered under Pay As You Drive insurance. However, it is best to go through the policy terms and conditions as every insurer may not offer coverage for the same
Car Insurance News
Which Car Insurance is Best in India: Comprehensiv...
Wondering which car insurance is better third-party or compr...09 May 2023
How to Buy Car Insurance Online?
Car insurance is a mandatory requirement in India. It is qui...08 May 2023
How to Search Vehicle Owner Details by Number Plat...
Read on to understand how to search vehicle owner details by...05 May 2023
Car driving tips for beginners
listed below are some of the car driving tips for beginners.03 May 2023
Traffic Rules and Fines in West Bengal
Read on to understand all about the traffic rules that you n...26 April 2023