PAYD insurance impacts in California
A new proposal has been done by California State Insurance Commissioner Steve Poizner to implement a Pay-As-You-Drive (PAYD) program in California. Worried about the fuel economy in the state of California, the government proposed a new federal regulations for 2020 to adjust the average vehicle fuel economy standards to 35/40 mpg. Moreover in California today the Insurance pricing is inequitable. Drivers who are similar in other respects—age, gender, location, driving safety record—pay nearly the same premiums if they drive five thousand or fifty thousand miles a year. That means more accidents, congestion, carbon emissions, local pollution, and dependence on oil. This pricing system is inequitable because low-mileage drivers subsidize insurance costs for high-mileage drivers, and low-income people drive fewer miles on average. So PAYD insurance system seems to be obvious and simplest model to be applied in order to give the opportunity to have a equitable tax per driver. A recent publ...