Question: Is it true that all car insurance companies automatically put you down for 10,001 miles, no matter the number of miles you drive a year? Say you only drive 10 miles daily, which averages a year of 3,650 miles. What then? Can a person receive a lower insurance quote if he’s able to input his actual mileage?

Answer: Car insurance companies tend to list a default mileage number in their system and on quoting forms, usually 10,000 or 12,000 miles because the number is typical for its customers.

But that number isn’t set in stone. If you drive a different amount of miles than the number listed, you need to inform the insurer.

Most car insurance quoting forms or applications allow you to change the mileage number to input a mileage amount that better represents your true annual mileage. Thus, if you drive only 5,000 miles each year in your vehicle, put that amount on a quoting form as your annual mileage amount.

If instead, you’re calling around for insurance quotes, tell the agent about your low mileage if you aren’t asked. If you don’t, the quote will probably be based on the company’s default number.

Since car insurance companies calculate your premium based on risk, how many miles you drive is considered and can affect your premium.

If you drive fewer than 5,000 miles a year, you should get a discount for driving less. Some discounts start at driving under 10,000 or 7,500 – again, car insurance companies’ internal guidelines vary.

Now, if your actual mileage is more than the national average, such as 20,000 miles, then you should expect higher rates because you’re on the road more than most other motorists.

Remember that where you drive also makes a difference to auto insurers. 

If your 5,000 miles are driven in New York City, you’re going to pay more than a driver that puts 5,000 miles on a vehicle in a rural area of upstate New York that has much less traffic, congestion, and accidents.

You may even want to look into pay-as-you-drive (PAYD) programs offered by various auto insurers.  With a PAYD plan, a telematics device is put in your vehicle and monitors your driving behavior to determine if you’ll be offered a discount – which can be as high as 50 percent. 

Because car insurance companies’ rating systems and discount amounts vary, you should compare car insurance rates with multiple providers to find the insurer that’s pricing competitively for your particular combination of rating factors. You could end up saving hundreds of dollars a year or more.

Penny Gusner contributed to this story.

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Contributing Writer

Prachi is an insurance writer with a master’s degree in business administration. Through her writing, she hopes to help readers make smart and informed decisions about their finances. She loves to travel and write poetry.