Why Did My New Car Raise My Insurance Rates?

While the casual insurance customer accepts that cars vary in how much they cost to insure, most don’t realize why that is. There are a few major factors that go in to determining rates, and these will ultimately decide whether your car shopping trip ends up in a bump or a decrease with your provider. Generally, you’re going to see an increase in premiums if one or more of the following conditions are met.

 

One: Theft Susceptibility

Each year there are studies released that track the susceptibility of a car to be stolen or vandalized. While you cannot control what someone else does to your car, your clean hands in the matter can’t do anything about this rating factor. If certain cars show a trend towards such vulnerability, they will always cost more to insure because the company has to assume that their risk for such a claim is high. You can cut back on this risk by choosing a different car. For the latest list of the most stolen new and used cars in America, be sure to check out this Forbes piece.

(For the record, the NICB notes that the most stolen used car is the Honda Accord, while the Nissan Altima took top “honors” for the 2013 model year. Expect 2014 model years on next year’s report.)

 

Two: Repair Costs

Ideally you’ll never be in a major accident while sitting behind the wheel of your car. Even if you’re lucky enough for that to be the case, you will need to do some maintenance and repairs to your vehicle throughout its life span, and that’s where it can start to inflate your premiums. Why? The reality is that some cars use highly specific parts that can’t be sourced from your basic auto parts store. When a repair shop has to send off for these parts, it boosts the cost of repair and creates a heavier financial burden on your insurer. To cover costs, the company has to rate such cars higher than they would a more repair-friendly automobile.

 

Three: Risk To Others

Insurance companies have access to data on specific car makes and models with regard to how they perform in real-life accident scenarios. If a specific car is shown to cause more injury or damage to other motorists and their cars or property, then it’s going to be rated higher than an automobile with a tamer history. If a car is involved in a lot of accidents where personal injuries are involved, that can be particularly troubling for an insurance company as medical expenses will have to be taken into consideration.

 

Four: Risk To Self

This rating factor is where a car’s safety features really start to shine. If a vehicle boasts a heavy-duty safety rating or has a demonstrated history of protecting its human cargo in the event of a collision, that will work to the vehicle’s advantage when the company is setting rates. Safer cars will incorporate things like front and side airbags as well as new technologies, such as the drowsy driving systems that monitor and alert a driver in the event that he starts to nod off. Great features to have if you’re hoping for a favorable rating.

 

In Summary

If you don’t want to be upset by the premiums on your new car purchase, then place a call to your insurance agent ahead of time and ask for rates on the year, make, and model of vehicle you’re purchasing. Tracking down such info is why your agent is there, and they can have you some new quotes in a few short moments, giving you all the details you need for a wise purchase.

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