What if you were told that you can save a bundle of money by purchasing a policy with annual premiums based on the number of miles you drive? Well, now you can because California’s Insurance Commissioner Steve Poizner’s announced this week about a beneficial plan; it’s called the Pay-As-You-Drive auto insurance plan. This is a phenomenal idea, not even “I just saved money on my car insurance” has launched this idea yet.

This plan would allow drivers the opportunity to purchase insurance policies where as the amount of miles they drive would be closely monitored by insurance carriers. This would be monitored through odometer checks, maintenance record checks or an electronic device that releases odometer readings. This process will allow your insurance carrier to receive precise information about the miles you have driven. This would also encourage companies to charge lower premiums to drivers. A recent study conducted by the Brookings Institution, showed that two-thirds of households in California would receive an average of $276 a year in savings.

For people who travel long distances to work, this would be a financial benefit to you. It will encourage you to live closer to your job. According to experts, if all drivers in California participated in this, it would save $1.2 billion gallons of gas per year, reduce pollution by $10.8 billion and even cut the greenhouse gas emissions by approximately two percent.

So, there may be a way to help cut the monstrous gas prices after all if the Commissioner’s proposal is enacted by next year – the sooner this happens the better.