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Your car insurance rates depend on many factors, but you might not realize your annual state inspection and routine maintenance records play a role. As mileage verification becomes more common, you want to understand how insurance companies use this data to set your rates.
At the Horan insurance agency, we work with multiple carriers and can help you understand how these practices affect your coverage options.
In this article, we'll explore how insurance companies verify your mileage, what this means for your rates, and what to consider when reporting your annual driving distance.
How Insurance Companies Access Your Vehicle's Mileage Data in New York
The days of taking customers at their word about mileage are over. When you get your yearly inspection in Central New York, the mechanic records your odometer reading.
This information, along with data from oil changes and other maintenance visits, feeds into third-party information exchanges like LexisNexis. Insurance companies can access this information simply by entering your vehicle's VIN number.
Many carriers review:
- Your odometer reading when you purchased the vehicle
- Service records from oil changes and maintenance
- Annual state inspection readings
- The mileage you reported on your application
Understanding How Different Carriers Handle Mileage Tiers and Rate Impacts
Insurance companies review mileage because it relates to time spent on the road. Each carrier structures their mileage tiers differently:
- Some start at 7,000 miles annually
- Others use 7,500 or 8,000 as their lowest tier
- Mid-range tiers typically span 12,000 to 15,000 miles
- Higher tiers run from 15,000 to 18,000 miles
- Vehicles driven over 25,000 miles may face limited coverage options
As carriers look for ways to match rates to risk exposure, accurate mileage reporting becomes increasingly important. They can verify your long-term mileage patterns by comparing your purchase odometer reading against subsequent inspection records.
For example, if you purchased your car with 38,000 miles and reported driving 12,000 miles annually, carriers can check if three years later your odometer aligns with the expected 74,000 miles.
What to Do When Your Actual Mileage Differs from Your Estimate
If your inspection shows different mileage than reported, carriers typically adjust rates at renewal rather than making immediate changes. They don't usually seek back premiums for past coverage periods.
For example, if you report driving under 12,000 miles annually but your inspection shows 22,000 miles driven, expect questions from your carrier. While one-time situations like a cross-country trip might explain the difference, consistent higher mileage will likely affect your rates.
Consider These Steps When Reporting Your Annual Mileage
When estimating your annual mileage, consider being realistic rather than overly conservative with your numbers. A too-low estimate could lead to surprises if inspection data shows higher usage. Information about how carriers use this data can help you make informed decisions about your coverage.
As your Central New York insurance agency, we provide information about carrier mileage tracking practices while exploring coverage options. We work with multiple carriers and consider local driving factors.
Click the Get a Quote button below to learn about car insurance options from an agency familiar with both industry practices and local Central New York considerations.
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