Metromile Insurance Review: Is Pay-Per-Mile Worth It?

If you are looking for a cheaper option for auto insurance, Metromile offers an intriguing solution. Its charges are based primarily on how much you drive.

Launched in 2011 in San Francisco, Metromile sells car insurance to people who would rather pay by the mile. As of late 2018, it was available in seven states including California, Illinois, New Jersey, Oregon, Pennsylvania, Virginia and Washington.

The company’s target market is people who drive very little. If you drive fewer than 10,000 miles per year, you could potentially save hundreds of dollars a year on your car insurance. (See also: Top Tips for Cheaper, Better Car Insurance and Beginner’s Guide to Auto Insurance.)

Metromile has all of the options you would get with most carriers. It covers bodily injury and property damage and has uninsured or underinsured motorist protection. It has the usual comprehensive and collision deductions from $250 to $1,000.

You also get 24/7 claims service and even roadside assistance.

Metromile insurance charges a flat monthly fee plus a mileage fee. You may pay $40 per month plus 5 cents per mile, for example. If you drive 500 miles per month you would pay $65 per month or $780 per year. As with traditional insurers, the fee varies depending on your driving record, age and where you live.

There are some exceptions to the mileage rule. First, Metromile will only charge you for up to 150 miles per day, or 250 per day in Washington. That means that the occasional road trip won’t break the bank, but you'd run up a hefty bill with a cross-country trip. 

There’s also the Uber exception. If you’re an Uber driver in some states, Metromile won’t charge you for the mileage you incur while driving for the service since you’re under Uber’s commercial insurance policy for those miles. Note that Metromile doesn’t offer this exception if you’re a Lyft or Sidecar driver and the Uber exception applies only in California, Illinois and Washington.

How does Metromile know how many miles you drive? It uses Metromile Pulse, which plugs into your car’s diagnostic port, the same one your mechanic uses to diagnose problems with your car.  Pulse then sends a raft of data to Metromile that you can access on the app or online. This includes not only mileage but the health of your vehicle and your location. Pulse has an alert system that notifies you if you need to move your car off the street. These alerts are called street-cleaning notifications.

Metromile insurance works much like any other carrier when it comes to eligibility. Your driving history, age, credit score and other factors determine your base and per mileage rates. That means there can be big differences between what you and your neighbor would pay.

Also, your vehicle has to have an OBD-II port. If your car isn’t more than 20 years old, you probably have one.

The idea sounds great and it may work well if you drive infrequently. A quick, non-scientific look at reviews of the company found them to be mixed. Many reviews say that the claims experience was less than ideal, and some people report that the price went up after six months to the point where it became cheaper to purchase traditional insurance. For more, see How Auto Insurance by the Mile Works.