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Pay as you go car insurance

A provider specialising in pay as you go car insurance has created a new policy for vehicle owners who drive only occasionally.

The new product – a first for the UK market – requires the car owner to take out a monthly subscription of between £10 and £30 that then has to be topped up for each hour the vehicle is used.

Cuvva, which already offers by-the-hour insurance cover for individuals to drive vehicles belonging to friends and family, said car owners will have to pay from £1.20 each time they want to get behind the wheel.

Drivers have to pay £10-£30 for a monthly subscription that covers the car when not in use.You pay from £1.20 per hour each time you want to drive the vehicle

Aimed at younger drivers who live in cities and cover less than 4,000 miles a year in their car

Cuvva says it could save some drivers up to 70% on a standard insurance policy

The cover is aimed at ‘young city dwellers who pay high insurance premiums for cars that are driven for fewer than 4,000 miles a year’, the Edinburgh-based insurer said.

According to Department for Transport and DVLA figures, there are approximately six million cars in the UK that are described as being driven ‘very infrequently’.

Cuvva said these low-mile drivers are forced to pay hefty premiums despite spending little time on the road, effectively subsiding higher-mileage motorists

As a way of cutting their costs, it offers drivers the choice to pay a monthly subscription that ranges from £10 to £30 depending on the car and where the person lives.This fully-comprehensive subscription insures the vehicle when it’s parked up at your home and not in use.However, when the owner decides they need to drive somewhere, they then have to pay from £1.20 for every hour they’re behind the wheel using a top-up service on the Cuvva app.Unlike it’s existing pay-as-you-go insurance service based on a driver being able to get behind the wheel of any car, the subscription cover is for one vehicle only.If two people share a car they would need two subscriptions in order to drive it.As with conventional insurance, users will earn a no claims discount at the end of a 12-month subscription, which is then fully transferable.

The monthly subscription can be cancelled at any time at no cost, though drivers run the risk of a fine from the DVLA if the vehicle isn’t insured by another provider or declared off the road – or SORN – at the end of the 28-day subscription period.

For more information please go to www.cuvva.com

 

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