Under the pay-as-you-drive concept, good drivers will get discounts and lead foots could face surcharges as high as 9 percent.
New Jersey will be the fifth state to offer the option.
Progressive says in other states, about one-third of the company's customers have enrolled. They're saving about 10 to 15 percent.
The program will begin Aug. 8.
New Jersey motorists have the highest auto insurance rates in the nation, an average of $1,184 per vehicle.
