![]() More recently, a second type of UBI has entered the market in the form of Pay How You Drive (PHYD) packages. For example, men pay on average $15,000 more for auto insurance during their lifetime compared to women, and young drivers have difficulties to find affordable insurances world wide. However, even within this customer segment, pricing is based on general statistics that might not apply to the majority of drivers. Traditional UBI approaches such as Pay As You Drive (PAYD) are gaining popularity, as customers only pay for the miles they drive. ![]() With recent car insurance cost surges, insurance companies are starting to realize that the majority of well behaved customers shouldn’t have to pay for the excesses of the few. The car insurance industry is rapidly transitioning from traditional fixed fee insurance packages to usage based insurance (UBI).
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