Pay-per-mile vs behavior-based — what's the difference
Pay-per-mile policies have two components: a fixed monthly base rate (covers theft, fire, vandalism — risks that exist when the car is parked) plus a per-mile rate (typically 5–10¢ per mile driven). Total premium = base + (miles × per-mile rate). The carrier tracks mileage via a small OBD-II device or a smartphone app.
Behavior-based telematics policies use a standard annual premium structure, then apply a discount of 0–40% at renewal based on a driving score measured during the first 30–180 days. Mileage is one input but not the only one — speed, braking, time-of-day all factor in.
Pay-per-mile carriers in 2026
The eight US pay-per-mile carriers and their per-mile rates (national averages, vary by state):
- Metromile — $29 base + 6¢/mi (CA, AZ, IL, NJ, OR, PA, VA, WA)
- Mile Auto — no base + 8¢/mi (CA, GA, IL, OH, OR, PA, TN, TX)
- Allstate Milewise — $30 base + 4–10¢/mi (most states)
- Nationwide SmartMiles — $40 base + 4–7¢/mi (most states)
- Hugo — pay-by-day liability ($15+/day, no commitment)
- Just Insure — pay-per-mile + behavior hybrid (TX, AZ)
- Root — 100% behavior-based, mileage as one factor
- Geico DriveEasy — discount-based, not true pay-per-mile
The math: when pay-per-mile wins
Pay-per-mile breaks even with a standard policy somewhere between 8,000 and 11,000 miles per year depending on the carrier. Examples (national average rates):
- 5,000 mi/yr driver: Metromile ~$648/yr vs standard $1,540/yr — saves $890
- 8,000 mi/yr driver: Metromile ~$828/yr vs standard $1,540/yr — saves $710
- 12,000 mi/yr driver: Metromile ~$1,068/yr vs standard $1,540/yr — saves $470
- 16,000 mi/yr driver: Metromile ~$1,308/yr vs standard $1,540/yr — saves $230
- 20,000 mi/yr driver: Metromile ~$1,548/yr vs standard $1,540/yr — break-even
Who should pick which
Pay-per-mile is right for: retirees, work-from-home professionals, urban residents who use transit, college students, second-vehicle households, RV/garaged classic-car owners.
Behavior-based telematics is right for: high-mileage commuters with safe driving habits, parents who want their teens monitored, drivers whose schedules don't include lots of late-night driving.
Both are wrong for: rideshare drivers (high miles + late nights), aggressive drivers (will see no discount or higher pay-per-mile bills than standard).