When you decide that you’re going to buy a new car, the obvious concern that you face will be how much of a car payment you may be able to afford, but you need to take into consideration the other expenses that come hand-in-hand with your new purchase. There are going to be fees for taxes and registration, costs for financing the vehicle, and most importantly above all else, the auto insurance expenses.
The auto insurance carriers factor in a multitude of criteria when determining the amount they will charge for your vehicle’s insurance rate. The main factor is the actual car itself, the make and model, what year it is, any specific features that have been added, as well as the cost.
Characteristics Of Vehicles That Affect Insurance
Certain characteristics and features for each car are going to be a part of what your auto insurance carrier uses to assess your premium. Some of these include:
Price
If you have a very expensive car, you will have an expensive insurance premium as well. This makes sense being that if you take out comprehensive coverage, the carrier will be responsible to pay out the value of the car if you have a total loss. The more valuable the car, the more the insurance company has to reimburse.
Repair costs
Foreign or luxury cars tend to be more difficult and costly to fix oftentimes requiring an expert specializing in their repair. If you’re in the market for a car that will have pricey parts or require special labor, your rates will reflect that.
Age
Cars that are either very old or very new can prove to be costly to insure. In the case of very old cars, there is generally no financing on these cars because it’s less expensive without. This means there would most likely be no comprehensive coverage.
Theft
Insurance companies stay up on statistics as far as theft reports and which vehicles are more popular among thieves for stealing or attempting to steal. Those that are most often stolen will be more expensive to insure.
Assumption
All too often, there are assumptions made by insurance carriers about drivers based on the cars that they choose to purchase such as the sporty, fast cars. Carriers presume that these drivers will be taking greater risks while on the road and end up having accidents. These cars can then tend to be more costly to insure as compared to family-oriented vehicles like a minivan or a sedan.
Narrow Your Search
When you’re looking to buy a new vehicle but want to get one that will stay within reasonable insurance premiums, a good place to start your research will be with Insure.com. Every year they put together a list of which cars are the most and the least expensive to insure. This will help guide you towards a particular make and model and then you can go on from that point. Just a hint: Mercedes isn’t looking good.
Hopefully, you are able to get your list down to just a few makes/models and you can focus on the amount that you want to budget for the car along with the size that you’re going to require, what types of features you’ll need, and other personal criteria. Once you’ve compiled this list, you’re set to look at quotes from a variety of different carriers.
Comparing Quotes
Until you actually have a car in front of you, it can be tough to find out just what it’s going to cost to insure the vehicle. You won’t know what safety features are going to come installed or the exact price until you’re involved in the buying stage. That doesn’t mean that you can’t prepare and come up with estimated quotes from various agencies for cars that have your interest.
The way for you to do this is to list your top three make/model vehicles along with the year that you’re interested in buying and research what comes standard for safety features and anti-theft devices as installed. You can put these through a site where they provide aggregators for insurance quotes and you can get several in one shot. You can also go through individual auto insurance carrier sites and compare their differences. As long as you have a basic idea of what you’re going to be insuring, you should be able to get a close estimate as to what rates you’ll receive.
Adding Or Replacing A Car
If you have an existing auto insurance plan and you buy a new vehicle, the new car should be covered for a period of up to 4 and as much as 14 days. This means you won’t need to change anything about your policy prior to buying a new vehicle. This is true in cases of either adding or replacing a car. Keep in mind, while the new car is on this existing plan, it will be valued as such. If you have a total loss of your new car, you will only be reimbursed for the ACV or actual cash value of the previous car on the existing policy. This is a good reason to have the new car immediately added to the plan prior to taking possession.
Before you can even take possession or drive off of a car lot, you have to show proof of car insurance and most financial lenders won’t sign off until you meet their own set of requirements as far as auto insurance is concerned. Auto insurance is without a doubt one of the most critical parts of buying a new vehicle.