More than 20% of all U.S. auto insurance companies will incorporate some form of pay-as-you-drive insurance within the next five years, but carriers should think twice about which consumers will sign up for that service.
According to an InsuranceQuotes.com report, more than half of Americans (51%) would not consider enrolling in a PAYD program, an increase from 37% last year. The findings are based on a survey conducted by Princeton Survey Research Associates International of 1,0001 American adults.
The reason for the pushback? Privacy issues, according to 21% of respondents. When broken by age, 27% of those 50-64 years old cited privacy, compared to only 15% of Millennials, the report says. Perhaps related, the majority of respondents incorrectly think that PAYD programs monitor for drunk driving and driving in high-crime neighborhoods (they do not).
Millennials, however, do not share those concerns, as they are the demographic most likely to enroll in usage-based insurance programs. Of drivers between the ages of 18 and 29, 43% would consider participating in a PAYD program, which compares to 36% of drivers between the ages of 50-64 and 28% of drivers aged 65 and over. Millennials (47%) are also most likely to have heard of usage-based insurance, compared to just 27% of those 65 and older.
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