Pay as you drive insurance 'can save motorists money'

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Motorists that sign up to 'pay as you drive' car insurance schemes can save up to a third on their cover, according to Norwich Union.

The insurance provider has stated that such products have proved increasingly popular since they were first introduced about two years ago and added that 40 per cent of its customers have saved around 30 per cent on their premiums.

Erik Nelson, general insurance media relations manager for Norwich Union, added that the products can be useful for those who do not want to use their car but need it for certain situations.

"It's a great policy and it rewards you for driving less which has great environmental benefits," he added.

Pay as you drive insurance schemes work through the use of a GPS device in a car.

The system records information on car journeys and transmits it back to a provider, where the company can use the details to calculate a premium and a bill for a consumer.

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