People are still reeling from the insurance industry’s loyalty penalty scandal, and they’re now faced with a fresh one – the low mileage penalty. If you don’t drive much, you should definitely be paying less for your car insurance than a higher mileage motorist. We’ve found out that’s not the case.

We’ve analysed over 1.7 million quotes from comparison site MoneySuperMarket and the findings are clear. The average UK motorist drives 7,090 miles a year – and if you drive under that amount, you’ll end up paying an average of £180 more for car insurance than those who drive over 7,000 miles.

People are still reeling from the insurance industry’s loyalty penalty scandal and now we have another issue – the low mileage penalty.

Based on the latest Government car ownership data, that means nearly 19.3 million UK motorists could be overcharged due to the low mileage penalty.

Spending less time on the road makes you far less likely to have a claim, but this isn’t being taken into account in quotes from traditional car insurers. At a time when drivers are completing fewer miles during the lockdown, the unfairness of the traditional car insurance pricing structure is clear to see. If you drive less, you should pay less.

The technology is there, the data proves it. Let’s just be honest – it’s time lower mileage drivers got a better deal. It’s only fair.

James Blackham
CEO and co-founder of By Miles

How many people are paying
more for driving less?

19.3 million

drivers are being overcharged.

That’s the number of cars in the UK being driven under the national average mileage.


is the average low mileage penalty.

This is what motorists driving under 7,000 miles a year are being overcharged by, compared to higher mileage drivers, but some are overpaying by much more.


miles a year is the UK average.

This is the average annual distance driven in UK cars, according to the latest MoT data.

1.7 million

customer quotes.

This is how many quotes for car insurance we’ve analysed from MoneySuperMarket to carry out this research.

Drivers are still paying the low mileage penalty.

Last year we looked at over 2 million car insurance quotes from 2018 and discovered a worrying trend… Lower mileage drivers were being charged more for driving less. A year on, this unfair practice is still happening.

The average motorist driving under 7,000 miles is charged £180 more than a motorist driving over that amount. While 5,000 - 6,000 miles a year is the most popular mileage bracket declared by drivers, these drivers are being charged £215 more than those that say they drive between 11,000 - 12,000 miles a year.

But aren’t higher mileage motorists better drivers?

Not exactly. Claims data shows that the more miles someone drives, the more likely they are to make an insurance claim.

Motorists who said they drive 11,000 to 12,000 miles a year are around 1.5x more likely to declare making a claim in the past 5 years than the average lower mileage driver. But as the risk of claiming increases with mileage, for some reason the average price of a policy goes down. It doesn’t make sense.

“With the right technology in place, the whole industry should really be looking towards changing to a fairer pricing model.”

Dave Merrick
Head of Motor at MoneySuperMarket

Experience doesn’t seem to count for much either.

It makes sense to think that the longer you’ve been driving, the more experienced you become and your insurance would reflect that. Unfortunately, our analysis found that all motorists pay a low mileage penalty, regardless of their age.

We calculated the penalty drivers paid for driving double the mileage (5,000 – 6,000 miles compared with 11,000 – 12,000 miles) in each age group and found that 25 – 29 year olds were inexplicably the worst affected, with lower mileage drivers in that age group paying on average a whopping £239 more than their higher mileage counterparts.

With pay-by-mile car insurance, the less you drive, the less you pay.

Given our research, traditional insurance doesn’t make sense if you don’t drive much. At By Miles, we believe lower mileage drivers should be rewarded for driving less. It’s better for us, it’s better for their wallets, and it’s better for the planet.

Analysis of the cheapest car insurance quotes from By Miles shows that we do just that, so the less you drive on our policies, the less you pay. Our report shows that the lowest mileage drivers using traditional car insurance are potentially paying over double what they could be on a pay-as-you-drive policy.

Our campaign is making a difference.

Since our first report last year, it does look like traditional car insurance companies are taking note. Is it due to new competition in the market from more flexible providers? Is it that they’re looking more closely at the data? Or is it totally unrelated? We don’t know.

But we do know the low mileage penalty is still an issue. It’s not fair, it doesn’t make sense, and lower mileage drivers are losing out on cash as a result. We’re calling on the Association of British Insurers (ABI) to put an end to the low mileage penalty.

What can you do about it?
Look at new kinds of car insurance.

Check the number of miles you drive on your new MoT test report and take the time to shop around for a new car insurance policy that suits your needs. If you drive under 7,000 miles a year, try getting a quote for a pay-by-mile car insurance policy.

New methods of insurance are challenging the traditional policies, and helping drivers to pay a fairer price based on the exact miles they’re actually driving each month.

Get a quick quote in under 60 seconds

About the authors.

About By Miles.

By Miles is a UK company that provides pay-as-you-drive car insurance to those who drive fewer than 7,000 miles a year. Drivers pay a small upfront sum for an annual policy and are then billed at the end of each month for the actual miles they drive. This offers many drivers the opportunity to cut their bills if they mostly use their cars for regular short trips or at weekends.

By Miles policies are fully comprehensive, underwritten by a panel of insurers including AXA Insurance UK Plc and La Parisienne Assurances, and as of 30th April 2020 were rated 4.8 out of 5 on Trustpilot. By Miles is authorised and regulated by the Financial Conduct Authority.

About MoneySuperMarket.

MoneySuperMarket is the UK’s leading price comparison website. They provide free, online tools to help people manage, save and grow their money, by enabling them to compare and switch Insurance, Money and Home Services products from more than 980 providers across 44 different channels.

MoneySuperMarket is part of the Moneysupermarket Group PLC, an established member of the FTSE 250 index. In 2017, they helped nearly eight million families save an estimated £2bn on their household bills, including five million people who saved money on their insurance, two million who got a better deal on their finances and over half a million households that switched their energy supplier. Limited is an appointed representative of Financial Group Limited, which is authorised and regulated by the Financial Conduct Authority (FCA FRN 303190) for the insurance, mortgage and consumer credit products it offers.

For energy products, MoneySuperMarket is accredited under the Ofgem Confidence Code.

Where did the data come from?

  1. Data based on 1,729,237 quotes from car insurance providers on MoneySuperMarket.
  2. Data period: 1 July 2019 to 30 Sep 2019.
  3. Prices shown are the average price of the cheapest car insurance quotes returned for each age and annual mileage group.
  4. Analysis of other insurers pricing excludes By Miles price data.


  • Duplicates (one enquiry per MoneySuperMarket customer email address)
  • Outliers
  • People on provisional licences
  1. Data based on 1,729,237 customer quotes from car insurance companies on MoneySuperMarket run between 1 July 2019 to 30 Sep 2019. Prices shown are the average price of the cheapest car insurance quotes returned for each age and annual mileage group.
  2. 31.9 million cars licensed in the UK as of April 2020, according to the latest data from the Department for Transport.
  3. 11,534,924 out of 19,114,682 cars drove 7,090 miles or less per year (60.35% of all UK cars). UK average of 7,090 miles a year in 2018-19 joined data, according to the latest MoT data from the Department for Transport. Cars less than three years old not are not included in the MOT data.
  4. 60.35% of 31,900,000 cars is 19,251,650 cars. This suggests nearly 19.3 million drivers are still in danger of being overcharged for car insurance, according to analysis of the data above.