Pay-as-You-Drive: Could You Save ₹12,000 on Car Insurance?

Motor insurers are now offering personalised plans — pay-as-you-drive, named-driver covers, and data-linked premiums. If you drive less or safer, you could pay significantly less than a standard own-damage policy.

Here's what happened: Indian motor insurers are rolling out personalised own-damage covers — including pay-as-you-drive, named-driver plans, and telematics-linked premiums — using real driving data.. IRDAI's regulatory sandbox framework has enabled select insurers to pilot usage-based motor insurance, where premiums are calculated on kilometres driven or driving behaviour scores.. Named-driver policies, which restrict cover to listed drivers only, are gaining traction as a lower-cost alternative for households where a car is driven by one or two people regularly..

What you should do: At your next motor insurance renewal, ask your insurer or broker explicitly whether a pay-as-you-drive or telematics-based own-damage policy is available for your vehicle.. Check your last 12 months' average monthly driving distance — if you're clocking under 800 km/month, a mileage-linked plan will almost certainly be cheaper than a flat-rate premium.. Compare named-driver policies on aggregator platforms like PolicyBazaar or Acko if only one or two family members regularly use the car — this alone can cut your own-damage premium by 20–30%..

Telematics-based policies often include a free 'monitoring period' of 30–60 days before locking in your premium — drive carefully in that window and you could secure a lower rate for the full year.

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