California Car Club Seeks Pay-As-You-Drive Approval

©2010 Bloomberg News

June 29 (Bloomberg) -- Automobile Club of Southern California, a drivers' group in the U.S. state with the most cars, submitted the second application to offer insurance in which motorists get discounts for traveling less.

The filing for pay-as-you-drive coverage is being reviewed along with an earlier request by State Farm Mutual Automobile Insurance Co., California Insurance Commissioner Steve Poizner said today in an e-mailed statement.

Pay-as-you-drive coverage allows companies to track miles traveled and other data about driving habits, to help set policy prices. Poizner, a Republican, approved the coverage in October. State Farm, the largest U.S. car insurer, was the first to apply in May.

The program allows "insurers to offer plans based on more accurate mileage," Poizner said in the statement. "People who choose to drive less will pay less for auto insurance."

--Editors: Dan Kraut, Dan Reichl.