How Does Mileage Affect Car Insurance | TGS Insurance Agency

How Does Car Mileage Affect Car Insurance Rates?

TGS Insurance » Blog » Auto Insurance Resources » How Does Car Mileage Affect Car Insurance Rates?

The ongoing COVID-19 pandemic has changed our lives for the better part of a year, with a lot of Americans staying home more, working from home, and traveling less- all resulting in a lot less driving. The good news is you might see (or already have seen) a decrease in your auto insurance premium! Typically, the more you use your car, the higher your auto insurance rate will be because the more time you spend on the road raises your risk of getting into an accident- even a very minor one. Let’s take a closer look at how mileage affects car insurance premiums.

Why Are You Asked for Your Annual Mileage?

Insurance carriers ask you how many miles you drive annually because they’re trying to determine how often you’re on the road. Those who drive more frequently may have a higher premium than those who aren’t. It’s in your best interest to answer truthfully and not underestimate your number of annual miles just for a discount. The reason they ask for this number is they’re trying to assess your risk because again, the more time spent on the road puts you at a higher risk of being involved in an accident. 

If you recently started driving less because of COVID-19 and you’re working from home, recently retired, or some other reason, be sure to accurately estimate your “new” annual mileage. You don’t want to input the same average you typically put, because you could be paying more in auto premiums when you don’t need to. That is why it is always important to accurately provide your insurance carrier with the right mileage average.

Another way auto insurance companies determine your annual mileage is if you elect for a “pay-as-you-drive” or “usage-based” insurance plan. Instead of you telling them your estimated mileage average, they can monitor how you drive and determine your auto insurance rate that way. These types of programs are ideal for those who don’t drive often and practice good driving habits. 

What Are Commuting Miles and How Do They Influence My Auto Insurance Rates?

Commuting miles are considered miles you drive from home to work and back. Insurance carriers want to know what days you’re commuting and how many miles so they can make sure what you’re reporting to be your annual mileage is accurate, and of course, assess your risk level. 

For example, if you live in a suburb of a larger metro area, such as Houston, and you commute 30 miles each way five times a week, you may have a higher auto premium rate compared to someone who commutes seven miles to work three times a week. The more frequently you commute tells your insurance provider that you’re on the road more and are deemed a higher risk to insure.

What Do Providers Consider to be Low Mileage for Car Insurance?

Depending on your state’s laws and your insurance provider’s guidelines will mostly determine what low mileage looks like. Most insurance providers consider motorists who drive less than 12,000 miles per year to below, whereas other providers may consider anything less than 10,000 miles. Either way though, if you drive under your carrier’s average threshold, you could see some major discounts! If you want the best low-mileage discounts you must average under 5,000 to 7,000 miles each year.

Most insurance companies have their own car insurance mileage brackets and your rates can be lower or higher based on your annual mileage. A mileage bracket is a tier system that insurance providers use to calculate where your driving mileage falls. They are based on each insurance provider’s algorithms and the state laws that correspond with the mileage.

What is the Average Annual Mileage Per Driver?

The Federal Highway Administration (FHWA) estimated an average of 13,746 miles are driven by US drivers a year. Below are the most recent data of each age group’s annual averages.


From the data provided, the results show that males in the age range of 35-54 do the most driving whereas, females in the age range of 65+ did the least amount of driving.

Auto Insurance Low Mileage Discounts

Low mileage discounts vary upon insurance providers, but most offer up to 20% off for drivers who don’t drive as much. For more tips on how to save money on car insurance click here. Be sure to always ask your insurance agent if you qualify for any discount because each provider is different! 

The way you drive and how much you drive has some impact on your auto insurance rates. If you have an avoidable commute to work, try carpooling with coworkers who live in the same area as you or create carpooling shifts with the parents on your kid’s soccer team. These techniques can help you spend less time in your car, which means a lower annual mileage average. It’s important to remember that the more time you spend on the road, the higher the chance you have to get into a car accident, and ultimately this puts you at a higher risk to insure. Be sure to always drive defensively and be mindful of other drivers while on the road to avoid accidents.

How to Save on Auto Insurance

Whether you’re on the road a lot or spend more time at home, the key to saving on your auto insurance policy is making the switch to TGS Insurance Agency! Our agents will shop your auto insurance policy across 30+ A-rated (or better) carriers to ensure you’re getting the best deal on your car insurance policy without sacrificing coverage. We’ll even handle everything from start to finish for a seamless, stress-free car insurance shopping experience. Get started now and see why thousands of Texas drivers are making the switch to TGS Insurance!