Why Are Your Average Miles Driven per Year Important?

The average annual miles driven per year is a statistic used to determine how much a vehicle is used in a year. This statistic is important for insurance companies because it’s used to determine the rate that the companies charge their customers. Understanding your annual mileage and other driving habits can help you keep insurance premiums in check.

Average Annual Mileage

The average miles driven per year on a car is about 14,000 miles. Anything above that figure is generally considered high mileage, which can significantly affect a vehicle’s insurance premium.

What Are the Average Miles Driven per Year in Each State?

Every year, the United States Federal Highway Administration of the Department of Transportation (DOT) reports the average miles driven by vehicles in each state. The numbers vary because states have different public transportation systems. Some states are more reliant on vehicles compared to other areas.

Some states are more dependent on cars because they tend to have more rural communities, as opposed to urban communities. Rural communities are more reliant on vehicles because they have fewer available public transportation systems. The state with the highest average miles driven per year is Wyoming, a state that’s 99.8% rural.

On the other hand, the states with the best public transportation systems have the lowest average miles driven per year. These include places like the District of Columbia, Oregon, Washington, and Pennsylvania. Gas prices are another factor that can affect people’s behavior when it comes to driving. States with the highest gas prices have lower average car mileage per year.

Driving Activities During the COVID-19 Pandemic

Streets were basically abandoned when the pandemic hit in 2020. Lockdowns and quarantine protocols were strictly implemented, confining millions to their homes.

The pandemic forced many establishments to implement a work-from-home setup, which meant the working class didn’t have to drive for miles to get to their offices.

With fewer vehicles roaming the streets during the pandemic, a dramatic decrease in annual mileage followed.

According to the Bureau of Transportation Statistics, vehicle travel decreased by as much as 60% during the weeks when lockdowns were implemented.

Vehicle travel began to return to the baseline in the summer, with summer and winter holidays creating busier streets than normal.

How Does Your Annual Mileage Affect Your Insurance Rates?

The amount you pay for auto insurance is directly proportional to your annual mileage. People who drive their car more frequently are more likely to get insurance because they’re also more likely to get into an accident.

Insurance companies try to predict your risk and determine your premium based on the number of miles you drive each year, as well as other factors like age and experience. Insurance companies typically ask their customers for their annual mileage when they apply for insurance.

You should give the insurance company an honest mileage estimate. While there may be no legal ramifications for underestimating your annual mileage on the application, it can be a problem if you’re involved in an accident. If you get into an accident and file a claim, the insurer will discover the vehicle’s mileage. Some companies request odometer reading updates. Other providers might even perform random mileage checks to avoid soft fraud when figures reach below average miles.

You should also let your provider know if your driving patterns change because a shorter or longer commute changes your rate. Additionally, the type of driving you do also affects your insurance premiums. So you might be charged a different rate if you drive merely for pleasure compared to if you drive as part of your commute.

Going Over the Limit

If you’ve bought car insurance before, then you already have an idea of how the process works. But for those who are relatively new to the concept, here’s a bit of information you should know.

Insurance providers will rely on you to give an estimate of how many miles you drive every year.

In most cases, car owners will consider every destination they’d usually go to in a week and multiply those miles by 52. This should give you a rough estimate of how often you’re out on the road, which can also help the insurance provider determine how much to charge you.

But what happens if you exceed your average annual miles per year?

Well, insurance companies don’t expect accurate miles, which is why they ask for estimates. In most cases, they’ll have to look into your vehicle’s mileage and see how much you went over.

So, if you think you’ve been driving more than usual, you can wait until you renew your insurance policy and update your estimated mileage.

You can also contact your insurance provider to inform them about your exceeded miles.

What Are Commuting Miles?

Most individuals who own a car use it to get to work. The amount of miles it takes a person to go to and from work is called commuting miles. This number is used by insurance companies to evaluate if an applicant has a reasonable annual mileage estimate.

Insurance companies frequently allow up to 20 miles each way for commuting before raising premiums. Commuters who travel more than that may have higher rates due to increased time spent on the road. Additionally, insurance companies can also charge higher if you live in a densely populated area with a higher incidence of accidents.

What Is the National Average Commute to Work?

According to the US Census Bureau, the average one-way travel time to work was 27.6 minutes in 2019. This means one round trip will likely take you a little under an hour. However, keep in mind that this can still vary depending on several factors, including where you live. For example, New York has the longest average commute time with 33.4 minutes, while Washington, DC comes in second with 32.8 minutes. On the other hand, South Dakota is considered the best state for commuting, with an average commute time of only 16.6 minutes.

Do Different Demographics Have Different Annual Mileages?

Actuaries hired by insurance firms crunch figures to forecast risk among policyholders and set the appropriate policy prices.

According to the most recent DOT data, there are considerable differences in driving behavior based on gender and age group.

• Men drive 6,000 miles more each year than women.
• Men aged 34 to 54 drive the most–-about 19,000 miles each year.
• Women over the age of 65 drive the least, averaging fewer than 5,000 miles per year.
• Every year, working-age males drive around 7,500 more miles than working-age women.
• Drivers aged 16 to 19 and individuals over the age of 65 drive an average of 7,600 miles each year.
• Motorists drive more each year until they retire. During retirement, their yearly mileage declines by 30%.

Can You Get a Discount on Insurance if You Don’t Drive Frequently?

You can be charged less for insurance if you drive less than the average annual mileage. Insurers often give the largest discounts to people who drive their cars less than 7,000 miles per year.

Low-mileage car insurance electronically records your vehicle’s mileage either through a telematics device placed in the vehicle or through a smartphone app. A set monthly charge and a minor fee per mile are included in the premiums for this form of insurance.

Some drivers might be concerned about their privacy as a result of the tracking, while others believe the cost savings exceed any apparent intrusion. You shouldn’t worry because insurance companies only care about your vehicle’s mileage, not your location.

Is There a Correlation Between Average Annual Mileage and Car Prices?

The national average annual mileage in 2019 was 4000 miles higher compared to 2011. This rise of the average annual mileage influences how Americans buy automobiles. Higher average annual mileage numbers at the national and state level might incentivize people to buy more fuel-efficient and electric vehicles. The changes in demand for these vehicles can affect their prices.

Meanwhile, the average annual miles that you drive in your vehicle can also play a role in your vehicle’s resale price. Generally, vehicles will have a lower resale price when their odometer accumulates more miles.