Insurance

Value vs. Rates: Ways Your Choice of Vehicle Affects Your Insurance

CleverDude_DetailPicAuto insurance prices tend towards the outrageous these days. With rates rising by 3% each year on average, the typical mid-income family pays $1,500 on each car owned. These prices change dramatically based on a number of factors. Louisiana and Michigan are the most expensive states for auto insurance, with the average customer paying about $2,500 a year. At $900 a year, Maine’s average insurance rates are the cheapest (the streets in Maine tend to be so empty, accidents rarely happen). There isn’t much of that one can do about the state the one lives in, though.

According to www.crosskeysauto.com if you need to bring some reason to your auto insurance premiums, choosing the right kind of car is one of the most important areas to work on. Even in Ohio, one of the states with reasonable auto insurance rates, it can set you back about $6,000 a year to insure an AMG-tuned Mercedes-Benz. It bears thinking about.

You need to be careful about what car to buy even if you don’t plan to blow tens of thousands on a sports car It isn’t just about how expensive or sporty your car is. Your choice of car affects the prices you pay in all kinds of other ways.

How old your car is

When you buy used, you might think that the insurance is likely to cost far less than on an older vehicle, considering how inexpensive the car is. In reality, though, prices don’t become dramatically cheaper. To begin, since more tends to go wrong with older vehicles and there tend to be few driver safety features available than on newer vehicles, accidents are a greater risk.

Used cars tend to be a higher theft risk than new, desirable cars, as well. According to numbers by the National Insurance Crime Bureau, 70% of their list of frequently stolen vehicles today is occupied by cars between 15 and 25 years old. Old cars simply come with fewer security features. It can be easier to open and hotwire an old car, something that tends to be very difficult on newer cars.

How modified your car is

If you’re hoping to buy a classy modded car — with aftermarket alloy wheels, extra lights and a tuned up engine — you should be prepared to pay more for your insurance. When you “pimp” your ride, it becomes more attractive to car thieves, and it tips insurers off that you are possibly someone interested in driving fast. They also worry that modifications, if not properly done, raise the risk of short-circuit fires.

What the regular customer profile for your car is

Most people who buy minivans and SUVs have families to shuttle between school, classes and sporting practice. These are people who tend to be regular drivers with no fast ambitions, preferring safety over tearing up the road. The size of these vehicles also make them safer — they are bigger than most other cars on the road. They are less risky for insurance companies to cover.

How easy to repair the car is 

Some cars are unnecessarily hard to fix. They use nonstandard parts, the parts tend to hard to access, and they tend to have areas of weakness where problems repeatedly occur.

The Ford F250, the Chevrolet HHR and many Audis and VWs are routinely criticized over the difficulty that they present to repair techs. Something as simple as a headlamp change can be an hour’s job on any one of these vehicles, simply because they haven’t been designed with accessibility in mind. Vehicles that are harder to repair cost more to fix, and therefore are more expensive to insure. The Research Council for Automobile Repairs publishes some information on ease of vehicle repair if you’re interested in checking before buying.

Color doesn’t affect insurance rate

It’s been a long-standing myth that bright red cars are more expensive to insure. Fortunately, this isn’t true. While there are many theories on how this myth may have come about, one might point to studies that find that red cars are involved in more accidents than white cars. There’s no need to worry, though; insurance companies do not dictate what color you need to pick.

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Joshua Barnes is an insurance sales agent. He enjoys writing about the field by posting online. He articles appear mainly on finance and insurance sites.

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