This idea is a natural extension of the fuel tax and ought to work both ways: decrease in insurance rates with a decrease in mileage, and an increase in insurance rates with an increase in mileage. The risk assessment relationship to rates is obvious, so that relating it to an incentive to drive less and disincentive to drive more program would be "icing on the cake" for ICBC.

While there are good stats supporting the idea that, on average, drivers improve with experience, you don't need stats to appreciate that a car that is not being driven is less likely to be in an accident. ICBC does have an "occasional driver" category, but it is I assume widely abused, and even if drivers are honest, you can still use the car for pleasure for great distances with this category. What's needed is a way to tie the cost of insurance to how much we drive, so as to provide a monetary incentive to drive less. This would not only be good for the environment, it would help clear the roads, and reduce accidents.

Right now I can go a month without driving my car, but still have to pay insurance as if I drove every day. (unless I put the car in a garage somewhere and insure for liability only, which defeats the purpose of having it handy, just in case...)

Auto insurance is already graduated based on your number of years driving.
If you drive it is assumed you get better. If not you get into accidents or collect points and you end up paying more for insurance. go to ICBC,com for more information.