Norwich Union (NU) could use a government initiative to introduce road tolls to boost its 'pay-as-you-drive' scheme.
Currently, road charges are collected at the point of entry on the UK's only toll road, the M6
But NU is considerreing working in partnership with government or other parties to use in-vehicle tracking schemes. The company believes this could lower the cost of its per-mile insurance pilot.
NU 'pay-as-you-drive' marketing manager Douglas Vallgren said: "As an enabler for 'pay-as-you-drive' to enter the market we are interested in keeping abreast of new initiatives.
"We have to look at all opportunities where the systems within a car are already in place."
Both Vallgren and a spokeswoman for the Information Commissioner went on to dismiss rumours that 'pay-as-you-drive' could run into problems with the Data Protection Act.
The commissioner spokeswoman said: "As long as people know the device is there and have given specific consent there is no problem.
"Norwich Union will also have to make sure the information is not used for secondary purposes."