You’ve done your research and after a lot of searching, you find the car you want and the deal you’ve been looking for. You’re happy with the outcome. The next morning you call your insurance agent and tell him you have a car to put on your policy. He gathers the required information from you and gives you a quote. You find out the newly acquired Honda Accord is $825 a year more than the insurance on your old Chevrolet Cruze. You ask, “How can that be?” Your insurance agent tells you, among other things, the primary reason is the Accord is one of the most stolen vehicles in America. The planning you did to buy a new car was incomplete, but hey, it happens all the time.
Not only are there a lot of key factors that must be included in your car buying plan, but there are also different things that factor into the cost of insuring a specific car. One calculation, with the biggest impact, is the value of the car. The more expensive a car is, the more it costs to insure. Also, higher-priced cars generally have higher repair costs when in an accident. A Porsche replacement hood is around $1,400 and a Ford hood is $700, this is why the higher-priced Porsche is more expensive to insure.
A car’s safety rating, including how safe it is to drive and how well it protects its occupants, are very important concerns insurers use when calculating rates. Cars with extensive safety features oftentimes qualify for premium discounts. Also, if a car can inflict above-average damage to another car during a collision, it will be more expensive to insure for the liability portion of coverage.
Sports cars are more expensive to insure than sedans. Sedans have four doors, and sports cars have two doors, but there are many two-door cars that are not sports cars. Sports cars cost more to insure because they are built to be driven fast, and often are, which leads to more accidents in comparison to their bigger counterparts: vans, SUVs, and pickup trucks. People can drive too fast in any of the aforementioned vehicles, but research indicates it’s less likely because they typically are family vehicles with children onboard. Also, sports cars are more likely to be stolen, especially if they are convertibles.
Four-door sedan’s insurance premiums are lower than other automobiles because of their size, they are not two-doors, and they are not large like an SUV or pickup truck. When compared to a sedan, SUV and pickup truck premiums are higher because they inflict more damage on other cars when in an accident.
If you are borrowing money to buy a car, keep in mind that most banks and credit unions require a $500 deductible. They don’t want their customers to have a $1,500 deductible, because they are worried some people may not have enough money to cover it.
After you have determined what vehicle you want to buy, the next logical step would be to contact your insurance agent. Most agents can give their clients a quote within minutes.
But before you become too attached to a vehicle that does not fit your budget, contact us, and we will provide you with the knowledge you need to make your next purchase a great one.
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