Norwich Union Car Insurance has stopped signing up drivers to their revolutionary new pay-as-you-go motor insurance scheme.
1,500 motorists have so far been allowed to take part in the initiative, which has been designed to save motorists money on their young driver car insurance by charging them for each individual mile that they drive.
The system uses satellite technology to log the time and distance of every journey made and a black box fitted to the car records the information. Initially, the scheme has only been made available to drivers aged between 18 and 24, as the opportunity for savings justifies the £199 fee to fit the box in the first place.
The rate charged for each mile depends on the car used, the location and the time of day. Daytime driving can cost anything between 6p to 15p per mile, but driving between 11pm and 6am costs a flat-rate fee of £1 a mile in order to deter driving at this high accident-risk time. Bills are calculated and sent out monthly.
If Norwich Union Car Insurance find the pioneering scheme successful, it could be widely implemented to save money not only on young driver car insurance, but for all types of motorists.