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How telematics insurance works
You install the insurer’s app or a small device, then drive normally for a monitoring period, typically a few months. The insurer scores your driving and sets a discount (or sometimes a surcharge) for future renewals. Commonly tracked factors include:
- Hard braking and rapid acceleration
- Speed and speeding relative to the limit
- Phone handling while driving
- Miles driven and time of day (late-night driving is scored as riskier)
- Idle time and location
Some newer cars can share data directly from built-in systems instead of an app.
Major programs compared
| Program | Maximum or typical discount | Rate increases? | Notes |
|---|---|---|---|
| Nationwide SmartRide | Up to 40% | No surcharge; discount can decrease in VA and WA | Monitors about 4–6 months; tracks midnight–5 a.m. driving |
| State Farm Drive Safe & Save | Up to 30%; 10% for joining | Discount recalculated and can fall | Not in CA, MA or RI |
| Progressive Snapshot | Average $169 sign-up discount; $322 average yearly saving | Yes, about 20% of drivers | Widely available |
| GEICO DriveEasy | Typically 5%–15% | Depends on state | App-based |
Sources: Nationwide, State Farm and GEICO official pages; Insurify Snapshot analysis. In J.D. Power’s 2026 study, Nationwide had the highest satisfaction among usage-based programs (711).
What regulator data shows
Maryland’s Insurance Administration surveyed insurers about their telematics programs in 2025. It found 13.23% of Maryland auto policies were enrolled in 2023, up from 9.49% in 2021, and 54 of 126 insurers used telematics. Of enrolled policies, 31.2% saw a decrease at renewal, 23.6% an increase and about 45% no change. Insurers retained driving data for anywhere from five to 25 years, and some indefinitely.
The lesson: telematics rewards genuinely low-risk driving, but it isn’t a guaranteed discount. If you often drive late at night, brake hard in heavy traffic or handle your phone, you may do worse.
Pay-per-mile insurance
Pay-per-mile policies charge a monthly base rate plus a per-mile fee. MoneyGeek’s October 2026 analysis found typical base rates of about $30 to $60 a month plus around 6 to 7 cents a mile, with most insurers capping charged miles at 250 a day (Liberty Mutual at 150).
- Nationwide SmartMiles is available in 40 states.
- Allstate Milewise is available in 17 states and Washington, D.C.
- Metromile is now part of Lemonade.
Pay-per-mile usually wins for drivers covering fewer than about 10,000 miles a year: retirees, remote workers, city residents and second cars. If you drive 1,500 miles or more a month, a standard policy is usually cheaper.
Driver-assist technology and repair costs
Many people expect safety features to cut premiums. They do reduce crashes, but they make repairs more expensive. A AAA study found advanced driver-assistance systems can account for up to 37.6% of a repair bill. Recalibrating a windshield camera costs about $900 to $1,200 and a front radar sensor $500 to $1,300. That’s one reason newer cars aren’t always cheaper to insure, and why telematics data on how you actually drive can be worth more to insurers than the car’s equipment list.
Is it right for you?
- Good fit: low-mileage drivers, daytime commuters, careful teen drivers whose parents want feedback, and anyone who wants to reduce a high premium after a clean year.
- Think twice: night-shift workers, drivers in stop-start city traffic, or anyone uncomfortable sharing location data.
Before you enroll, ask whether the program can raise your rate, how long data is kept and whether it’s shared with third parties. Compare the result with other discounts in our discounts guide, and see how it affects teen premiums in our new drivers guide.
Frequently asked questions
Can usage-based insurance raise my rate?
With some programs, yes. Progressive’s Snapshot raises rates for about one in five participants, and Maryland’s survey found 23.6% of enrolled policies saw increases. Nationwide says SmartRide doesn’t surcharge.
How much can I save with telematics?
Published maximums range from about 15% (GEICO DriveEasy) to 40% (Nationwide SmartRide). Many drivers get a smaller discount.
Is pay-per-mile insurance worth it?
Usually if you drive fewer than about 10,000 miles a year. Above 1,500 miles a month, a standard policy is typically cheaper.
What data do telematics apps collect?
Typically speed, braking, acceleration, mileage, time of day, location and phone use. Some insurers keep data for years.
Is usage-based insurance available in California?
California doesn’t allow driving behavior to be used in pricing, though mileage-based programs are available. Several telematics programs, including State Farm’s, aren’t offered there.
Sources
- Nationwide – SmartRide
- State Farm – Drive Safe & Save
- Insurify – Progressive Snapshot review
- GEICO – Car insurance discounts
- Maryland Insurance Administration – Telematics Survey Report (July 2025)
- MoneyGeek – Pay-per-mile car insurance (Oct 2026)
- AutoGuide – AAA study: advanced safety features make crashes more expensive
- J.D. Power – 2026 U.S. Auto Insurance Study
- MoneyGeek – Electric vehicle insurance costs (Aug 2026)
Insurance prices, discounts and rules change often and vary by state. Figures were checked in October 2026; confirm details with the insurer or your state insurance department.