Do you include car insurance in the cost of commuting?

[Future Lazy]

Hi All,

I've recently been working on a worksheet that will spit out a cost of commuting cents/mile for anyone based on just a bit of information about their car and commute.

I originally included a car insurance/mo divided by milage, which for me, comes out to about $0.15/mi by itself. This seems ok, since, we drive an average number of miles/year (about 10k). However, if you make this unusual at all, such as by driving less miles/yr, the cost quickly skyrockets way above a few cents/mile.

So, I haven't been including it in my calculations, simply because of this seemingly broken feature of it - and on account of the fact that it's a fixed expense, and doesn't depend on car use like other commuting math does (unless you have Snapshot or other pay-as-you-drive insurance).
 
How do you include car insurance in your cost of commuting? Do you include it per mile? Or do you just separate it out as another bill that's necessary to own a car, regardless of commute?

[slugline]

What other items are you including in your calculation now?

[Future Lazy]

What other items are you including in your calculation now?

See all of it here:
https://docs.google.com/spreadsheets/d/1jzGt-QxiO5iYiFw5PkoX-UVOnr6pj64zDqDhAJRRNNI/edit?usp=sharing

[slugline]

The thing about "auto insurance" is that it can really be two things -- (1) insurance against loss on the value of the car and (2) insurance against accident liability caused by yourself.

If the only reason you own the car is commuting, then I'd include  the first. If your state requires liability insurance, then the second would be a cost you carry personally simply to be a compliant driver and I would see it as not directly connected to your commute.

Do you pay a fee to register the car with your county/state? Would you include it as part of your commute cost?

[Jack]

When you get car insurance, the insurance company wants to know if you use the car "for pleasure" or for commuting (and how far you commute). Get two quotes differing only in how you answer that question. The difference in price is the insurance cost of using your vehicle to commute.

Alternatively, if you wouldn't own the car at all if you didn't use it to commute, include the total cost.

[Thegoblinchief]

When you get car insurance, the insurance company wants to know if you use the car "for pleasure" or for commuting (and how far you commute). Get two quotes differing only in how you answer that question. The difference in price is the insurance cost of using your vehicle to commute.

Alternatively, if you wouldn't own the car at all if you didn't use it to commute, include the total cost.

Interesting way to look at it.

[GoldenStache]

I calculate the difference in insurance that I would have either way with the additional insurance I would have to get if I drove to work.

I pay for insurance for 2,500 miles per year, the lowest mileage my insurance company offers.  I probably drive less than 1,000 miles most years.

If I would drive to work it would be about 5k miles per year, that would increase my insurance by about $5 per month. 

[Future Lazy]

The thing about "auto insurance" is that it can really be two things -- (1) insurance against loss on the value of the car and (2) insurance against accident liability caused by yourself.

If the only reason you own the car is commuting, then I'd include  the first. If your state requires liability insurance, then the second would be a cost you carry personally simply to be a compliant driver and I would see it as not directly connected to your commute.

Do you pay a fee to register the car with your county/state? Would you include it as part of your commute cost?

In my current situation, I have to have access to a car for commuting, and commuting is it's primary use, but commuting isn't the only reason we own a car. We only carry liability insurance, and don't carry insurance to replace the car (it's not worth much anyways, even after all the repairs).

When you get car insurance, the insurance company wants to know if you use the car "for pleasure" or for commuting (and how far you commute). Get two quotes differing only in how you answer that question. The difference in price is the insurance cost of using your vehicle to commute.

Alternatively, if you wouldn't own the car at all if you didn't use it to commute, include the total cost.

In this train of thought, we own the car 'for pleasure' (because aren't all cars for pleasure?), but use it primarily for commuting, and our pleasure driving makes up only a fraction of our driving. That is to say, total driving yearly-(my commute yearly + his commute yearly) = pleasure miles, and that comes out to like 9420 (avg miles per year) - 9880 (our total commutes/yrly) = ... -460 miles? I don't even know what to do with negative miles there haha.

Registration was about $350 this year, but I wouldn't think to include it since it is something we would pay anyways to have the car, regardless of commute.

So, I should rejigger my spreadsheet to ask for only the cost of comprehensive insurance, not liability?

ps. According to Chrome, "rejigger" is a legitimate word. B)

[neo von retorch]

I calculate "cost of driving my car per mile" overall first, no matter what. Then whatever portion is commuting is just multiplied.

i.e. if car purchase (spread out over how many years I keep it), insurance, maintenance, registration and gas all get included in my annual expenses. This is divided by my annual mileage. So if I drive 12,000 miles annually, spend a total of $2400, and drive 6,000 miles to work, then I spend $0.20 per mile and commuting costs me $1200.

Now I understand that if I suddenly used my car ONLY for pleasure, and only drove 6,000 miles a year, my spending would not drop to $1200. It might drop to $1600, and my cost per mile would be higher. And it SHOULD be higher if it's only being used for pleasure.

[BCBiker]

I would include insurance expense only if your sole purpose of the car is for your commute. When I calculate how much my bicycle commute saves me, I include the cost that a car insurance policy would add. If I ever drove to work, my wife and I would have to get another car and thus it would be a direct cost of commuting on a per mile basis or otherwise.

Could you squeeze by without your car if you didn't commute is the main question to ask?

 

[Future Lazy]

I would include insurance expense only if your sole purpose of the car is for your commute. When I calculate how much my bicycle commute saves me, I include the cost that a car insurance policy would add. If I ever drove to work, my wife and I would have to get another car and thus it would be a direct cost of commuting on a per mile basis or otherwise.

Could you squeeze by without your car if you didn't commute is the main question to ask?

As in, car not necessary except for commuting?

This is true - the grocery store, my favorite places and my family members are all within 2-3 miles of where I live, and almost EVERYWHERE is very accessible by bus (unfortunately except for where I work aghhhh so angry). It's nice to have a car to port groceries home in, in the winter and after work in the dark, esp considering the abhorrent lack of sidewalks in my neighborhood, but it could be done easily with a wagon/cart while walking or biking.

So, since my car is only NECESSARY for commuting, then include the ins? Does it make a difference if we would keep the car even if it wasn't necessary for commuting, since it makes driving to Boulder/Thornton to see family and port family around easier? Hmmm.

In that case, though, Snapshot would be zillion times cheaper than regular insurance, since not as much driving. Insurance which is already expensive due to DH's age.

If it is a case by case basis, as in, "Is your car only necessary for commuting? Y/N", how could I incorporate that into my worksheet for other users?

[darkadams00]

A somewhat different approach for me--"Commuting" typically implies "driving to work," but that is just a fraction of my biking. I also bike to grocery stores, the library, barbershop, bank, post office, park, retail stores...you get the picture. When I ride to a destination to do something that's related to "work/household activities"--tasks which many accomplish via car--I refer to those miles as "utility miles." I also include biking to a recreation spot, e.g. park, library, to do something recreational--again, often traveled via car by most folks. What's not included in utility miles--miles that I biked for the pleasure of getting outside, i.e. a weekend ride or a cruise around town. This means most of my miles are utility miles, all of which I can infer would have been resulted in an approximately equal number of car miles (ignoring a minor uptick in annual miles due to longer but safer bike routes).

Since my family (me, wife, teen son) all bike, we have been able to operate with just one car for the past two years or so. My calculation--

$EstimatedAnnualCar#2Costs - UtilityMiles%*$AnnualBikeCosts = $AnnualSavingsByBike (and divide $AnnualSavingsByBike by miles to get to a $/mile rate)

The estimated car costs are based on usage by my wife and me and include estimates on everything from inspection, tag, gas, insurance, maintenance, and repairs. Utility mile percentage is based on my log (my wife's would probably be within 20% of mine). Annual bike costs are based on bike expenses for all bikes in the house.

This is easier when biking allows you to drop a car and not just reduce your driving of a car.

[DarinC]

I include it, and it's currently my highest cost at about 4-6 cents per mile. Gas is next at about 4-5 cents per mile.

[fetish]

Keep in mind, many states have "pay as you drive" insurance that's related to your mileage and measured driving habits via an OBD module that you plug into your car that tracks speeding, cornering at speeds, abrupt breaking, and so on.


But the short answer is yes, you should include it - if the alternative is not owning a car at all.

[Prairie Stash]

Do both. the Variable cost/mile i.e. gas and certain repairs. Then total Cost/mile.  It's a very pretty spreadsheet, I like it :)

The variable cost is your incremental cost of driving. Total cost helps determine whether to keep the car at all. For example if the total cost was significantly higher than taxi rates you could logically sell your car.