A: Pay-as-you-drive car insurance is a new concept that rewards low mileage drivers with discounts on their auto insurance policies.

Right now, two big players in the insurance industry are offering different versions of the pay-as-you-drive car insurance concept.

Both Progressive and GMAC's programs for pay as you drive promise to score you big discounts on your auto insurance.

Under the GMAC program, consumers can save 11% just for participating and up to 54% if they drive less than 2,500 miles per year.

With Progressive, drivers could cut their auto insurance rate by up to 40%.

Pay-As-You-Drive Car Insurance Policies - What's the Difference?

The biggest difference between the Progressive pay-as-you-drive program and GMAC'’s version is what the insurance companies are keeping track of, and how they are keeping track.

For Progressive consumers, a small gadget is attached to your car that will send information back to the insurance company wirelessly. According to Progressive's website, the company doesn't just track your mileage. They're also keeping tabs on when you drive, and how aggressive you are on the road.

The data collected is then used to determine your auto insurance discount, which is applied at each six-month policy renewal.

GMAC offers a "Low-Mileage Discount" version of the pay-as-you-drive concept. You get an 11% discount just for participating and can save even more just by keeping low mileage, regardless of when you drove the miles, or how many times you hit the brakes while accumulating them.

GMAC uses OnStar equipment already installed in GM cars in order to monitor mileage.