You and your vehicle are the only considerations for car insurance companies to calculate the car insurance premium. They would also look at the claim histories that include repair costs, accidents, and car thefts. The higher is the probability of costly claims, the higher will be the insurance premium. Since low-cost claims arise from cheaper cars, these are the best choice if you want to pay a low car insurance premium. When buying a new car, you will look for features and compare prices so that you get the best deal but also know which are the cars with low insurance rates.
If you dream of owning a luxury car, you must be ready to pay for high car insurance too. Another factor that affects car insurance is the manner of financing. If you pay from your pocket the full cost of the car, then you can opt for taking only the public liability insurance, which is mandatory by law and not take any other cover. But, if you are borrowing to buy the car, then the lender will insist that you take adequate comprehensive coverage for the car so that they remain covered in the event of any eventuality.
Table of Contents
The features of your car impact insurance
Costly cars have more features and more luxury, which pushes up the cost of insurance. If you buy a cheaper car and keep adding new features to it, the next time you go for insurance, it will cost you more. Cars that have high-tech safety features might appear to attract low insurance premiums as the risks of damage are less, but it will cost you more because the added features enhance the value of the vehicle. Similarly, if you choose a car with a powerful engine, the insurers would perceive it as a risk as you could speed up recklessly and meet with an accident.
However, comparing cost to cost, a lower-priced vehicle could save you about $200 a year towards insurance as compared to a car equipped with GPS technology, a premium audio system, and a power moonroof.
Car model is a factor
Your car model contributes to the car insurance cost because after introducing the basic model, which earns the confidence of buyers, car manufacturers launch newer versions with added features that cost more. Going by the fact that there is a direct relation between the cost of the car and the cost of insurance, it is only normal that the cost of insurance of any car above the base model will be more. In other words, the more stylish you want your car to be, more the money you need to shell out for car insurance. You must bear this in mind when buying a car.
How to get cheaper car insurance
How you want to use the car and what kind of features it must have are the primary considerations along with the budget to decide which type of car you need. If you want to own a luxury vehicle, it goes without saying that you are not the one who would look for cheaper car insurance. But many are sensitive to cost and would not mind compromising in selecting the vehicle features as it helps to keep car insurance premium low.
Cars to keep away from
Below is a list of cars that you should keep away from to achieve your goal of lowering insurance costs.
Sports cars – Owning a sports car would attract the highest insurance premium because, according to the insurers, these cars have the highest risks of accidents. Firstly, sports cars are very high-speed vehicles that increase the chances of accidents. Secondly, mostly youngsters drive such cars who do not mind driving at break-neck speed and cause accidents. Naturally, insurance companies would not like to take any chances but charge very high insurance for sports cars.
Electric vehicles – Electric vehicles are prohibitively costly, with the battery alone costing thousands of dollars. Besides, the repair costs are also very high, which makes it evident that the insurance cost will also be very high.
Luxury cars – High-end luxury cars are no way better than electric vehicles in terms of insurance cost because these too are expensive cars that attract high insurance.
Theft-prone cars – Some car brands and models are more prone to theft than others, and if you own such a car, there is no reason to expect low insurance premiums. For the insurers, these vehicles carry the highest risk; hence, they charge a high premium to cover the risks.
Know the frequency of claims on car models
Although it is not easy to determine the frequency of claims of car models, this a factor on which the insurance companies base their calculation of insurance premiums. Like some cars are theft-prone, some cars are also prone to more repairs and maintenance. The insurance companies are aware of this as they have data to identify the cars that are potential troublemakers and charge higher insurance for it. Considering the reliability of the car model that you intend to buy should help to keep the car insurance premium low.
Self- driven cars can lower insurance
Just as the vehicle is essential to insurance companies for assessing the risks to work out the insurance premium, so also is the driver of the vehicle. If the owner of the vehicle is not driving the vehicle, then the cost of insurance will go up because the insurance companies would feel that the driver would not be much reliable to ensure safe driving as the owner would have done. If you are driving a car that your company has given you or your children drive your car, the insurance will be higher. If you want to enjoy the luxury of having a chauffeur-driven car, then you must be ready to pay a higher premium.
The kind of use of the car also influences the insurance premium, and you must be honest to declare its right use to avoid refusal of payout by the insurance company in the event of a claim.