Pay-per-mile insurance debuting in UK in 2017
By Miles, a start-up insurance company, will provide the UK's first pay-per-mile policy in late 2017 in a bid to offer lower premiums for low-mileage drivers. Using data from a telematics "black box", motorists will pay based on their miles driven intead of paying a yealy premium. Each journey's cost is logged on a connected smartphone app with users charged at the end of the month. The system works abroad and only requires the user installing the device in their vehicle.
The UK’s first pay-per-mile car insurance company has been launched, potentially allowing drivers with low annual mileages to save on their car insurance.

Aimed at drivers who cover fewer than 7,000 miles a year - roughly 140 miles a week - customers taking out insurance with By Miles will pay a flat-rate annual fee to insure their cars against theft or damage when parked. They are then charged a variable rate based on how much they actually use the car.

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Mileages are measured using a telematics device plugged into a car’s On Board Diagnostics (OBD-II) port, which typically located under a panel below the steering wheel. Drivers can track journey-by-journey mileages and charges using a dedicated smartphone app, and will be billed each month based on how far they've driven.

Crucially, drivers will not be charged more depending on how or how fast they drive, and By Miles says they will “never share any of your personal driving data with the police, unless we are obliged to as a direct result of a court order.”

Launched last year as a start-up – albeit one with backing from Jaguar Land Rover - By Miles has now begun selling its policies, which are underwritten by AXA. While a number of insurance companies provide cover for low-mileage drivers, these typically charge by the day or by the hour, or require consumers to predict how much they will use their cars, purchasing additional miles if that limit is exceeded.