RAC will offer ‘no-ties’ monthly plan to help low-mileage motorists save money 

Now you can insure a car by the mile! RAC will offer ‘no-ties’ monthly plan to help low-mileage motorists save money

  • RAC to offer monthly car insurance which could help low-mileage drivers cash 
  • Customers pay monthly subscription according to how far they actually drive 
  • Called Pay by Mile, it is aimed at people driving fewer than 6,000 miles a year.

The RAC is to offer ‘no-ties’ monthly car insurance that it says could save low-mileage drivers a lot of cash.

Instead of being tied to an annual contract, customers will pay a monthly subscription priced according to how far they actually drive, plus a monthly fee to cover their vehicles when parked.  

The cover offered is fully comprehensive.

Instead of being tied to an annual contract, customers will pay a monthly subscription priced according to how far they actually drive. Picture: Stock

Called Pay by Mile, it is aimed at people driving fewer than 6,000 miles a year.

Mark Godfrey, managing director, of RAC Insurance, says the per-mile cost will be as little as 4p and customers are free to leave without notice if they find a better deal.

He added: ‘Car insurance is a market that’s been ripe for a shake-up for some time so we’re thrilled to introduce a truly pioneering new product.

‘The impact of the coronavirus pandemic on driving patterns means it feels like this product has never been more relevant.’

The RAC has partnered with tech firm Wrisk to create a ‘drive tag’ that must be stuck to the windscreen and paired with a smartphone to record mileage.

There is a minimum £250 excess with the policy plus a one-off £50 activation fee.