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| Apr 07, 2025
Updated on - 13 Jan 2026
An odometer tracks the total distance travelled by a car and has a direct impact on its maintenance schedules, resale valuation and more. Their accuracy ensures timely service checks, prolonging vehicle longevity and performance.
Whether you are purchasing your first vehicle or looking to manage ownership expenses, understanding what an odometer is in a car, its types and key benefits is important. Knowing how it connects to a car insurance policy can also support maintenance, budgeting and coverage decisions. So, let’s delve into the significance of this device and find out how it tracks time and distance.
What do you mean by an odometer?
The odometer is an essential instrument which you will find on your car’s dashboard, next to the speedometer, usually showing numbers in miles or kilometres. It keeps counting from the moment you start driving your vehicle and continues throughout its lifetime.
The lifetime of certain parts and accessories in a vehicle is measured in distance travelled. So, the odometer also becomes an important tracker to know when parts need changing. Modern and luxury cars have digital odometers, while others may have mechanical ones.
Manipulating or resetting an odometer is illegal in India, given its potential to misrepresent a vehicle’s usage and history.
Types of odometers
Odometers are divided into two types based on their mechanism: traditional and digital.
- Traditional, mechanical odometers use rotating wheels connected to the vehicle’s transmission system. When the wheels spin, the odometer turns and updates the distance on the display. They are typically common in old vehicles.
- Digital odometers are common in most cars today. The vehicle's computer employs advanced sensors to calculate the distance covered and display it on a digital screen. Digital odometers may also offer other features, including trip metres, allowing drivers to monitor distances independently from the overall length covered.
While both types serve the same purpose, digital odometers give accurate data and are harder to tamper with.
How does the odometer work?
Here’s how odometers work in mechanical and digital systems:
1. Mechanical odometer
Similar to a bicycle’s speedometer, a flexible cable is connected to the output shaft of your car’s transmission system, the part that makes your wheels turn. As you drive, your wheels move and the cable spins inside a protective tube. This cable is connected to a series of gears inside the odometer. These gears are set up in a way that after your car runs a certain distance, they click the number forward by one.
2. Digital odometer
Advanced electronic sensors are used to detect a spinning toothed wheel attached to the transmission. Each time a tooth passes by the sensor, it sends a signal to the computer system, which counts the signals, calculates the distance and displays it on the dashboard in real-time. Each signal represents a certain distance. Digital odometers are similar to how a fitness app counts your footsteps.
Benefits of an odometer
Odometers do much more than just count the distance. They offer the following benefits for the car owners:
- Tracks your car for routine maintenance, since service intervals typically range from 10,000 to 20,000 kilometres.
- Reminds you to plan your oil change and tyre rotations.
- Lets you know when parts such as brake pads, spark plugs and timing belt might need replacements, helping you avoid breakdowns and costly repairs.
- Helps you monitor your car warranty, as most warranties specify mileage limits.
- Tracks actual fuel efficiency over different driving conditions by calculating how many kilometres you get per tank. It is critical for spotting performance issues early.
- Makes it easier to plan long trips by estimating fuel costs and scheduling refuelling stops.
Odometer’s role in car valuation and resale
Your car’s worth when you sell it depends a lot on the odometer reading. For example, cars with lower mileage sell for higher prices. Buyers check this reading first because it tells them how much life the car has left. A vehicle with fewer kilometres usually has less wear and tear on essential parts like the engine, transmission and even the metal body. When you are selling or trading in your vehicle, this reading primarily calculates how much money you will get.
In addition, cars lose value as soon as you take them out of the showroom. The mileage helps everyone agree to a fair price, including when a comprehensive car insurance plan claim is settled after complete vehicle damage.
By law, sellers must provide an odometer disclosure statement for cars which are less than 20 years old to verify the mileage and prevent fraud. This protects buyers from getting cheated and makes sure the mileage you see is authentic and accurate.
How odometer readings influence car insurance premiums
Your odometer reading can affect how much you pay for your comprehensive car insurance, though many drivers don’t realise this connection.
Insurance companies ask for annual mileage details because they want to know the usage of the car and get an idea of how much it’s being driven. Cars that are more often on the road have a higher chance of getting in an accident, so premiums tend to increase if the mileage is high.
However, mileage is just one factor among many that insurance companies consider. Premium costs are calculated based on probability, as a person who doesn’t drive much is less likely to make a claim.
Furthermore, the Insurance Regulatory and Development Authority of India (IRDAI) now permits insurers to issue pay-as-you-drive insurance policies that link premiums based on how well you drive and how much you drive. These policies let you set a mileage limit. The lower the limit, the more you save, making the odometer a vital element to determine your long-term and ownership costs.
Conclusion
The odometer records your car’s lifetime journey and thus helps you stay on top of maintenance, drive without breakdowns, understand your vehicle’s real value and manage insurance costs optimally. The reading tells potential buyers about your car’s condition and helps insurance companies assess risk and calculate premiums. Therefore, ensuring it works without glitches is critical for your car’s safety.
While you take efforts to learn the car odometer meaning and how to reduce your ownership costs, remember to protect it with a car insurance policy. Let us take the effort to financially and legally safeguard you during an unforeseen incident. Get car insurance online with relevant add-ons tailored to your everyday needs by filling out the form provided on this page.
FAQs
1. Can the odometer be reset or tampered with?
Modern digital odometers are harder to tamper with than mechanical ones. Tampering with or resetting odometer readings is illegal in India and doing so can lead to severe penalties. Always check service records before buying an old car to avoid fraud.
2. Do odometers require maintenance, too?
Odometers usually don’t require separate maintenance, but you must ensure that the sensors, wiring and display function properly. If readings seem inaccurate, get it checked with a qualified mechanic.
3. What is a pay-as-you-drive policy?
Pay-as-you-drive (PAYD) policy is a type of car insurance where the premium is calculated based on the average distance you drive and your driving habits. The insurer uses the odometer reading or installs a telematic device to track the actual distance and then adjusts the premium accordingly.
4. Can a broken odometer still calculate distance?
No, a broken odometer may not accurately calculate or display distance. If its mechanical parts, sensor, software system or wiring are damaged, it can freeze or reset readings. This could affect the car’s resale value or insurance costs. Get it fixed immediately.
5. Does a higher odometer reading always lower a car’s resale value?
A higher odometer reading may indicate more usage and wear, which can influence resale value. However, the impact can depend on factors such as maintenance history, model, age and market demand.
Disclaimer: The information provided in this blog is for educational and informational purposes only. It may contain outdated data and information regarding the topic featured in the article. It is advised to verify the currency and relevance of the data and information before taking any major steps. ICICI Lombard is not liable for any inaccuracies or consequences resulting from the use of this outdated information.