Insurance Coverage for Our Family

The Car You Buy Can Affect The Cost Of Your Insurance

19 June 2020

Christian Byrd

When it comes to buying a car, there is more involved with the process than actually selecting the car. You also have to think about insurance. While your driving habits and your credit score can impact how much you pay for insurance, the type of car you select is also a consideration. If you have plans to purchase a new vehicle, learn how the car you purchase can affect your insurance.

Vehicle Value

How much the vehicle costs will directly impact how much it costs to insure the vehicle. The reason for this is that the value of the vehicle reflects how much the insurance company has to pay. 

Take a brand-new car valued at $20k and another valued at $55k, for instance. If both vehicles were involved in an accident in which they were totaled, the insurance company would undoubtedly have to pay more to replace the $55k vehicle than they would the lesser one. As a result, it would not be unheard of for the person with the higher value vehicle to also pay higher premiums. 

Threat Risks

When you add a new vehicle to an auto insurance policy, the insurance company will also generally assess what type of threat the vehicle poses in terms of theft. Unfortunately, there are some vehicles that thieves will target more than others. 

As a result, if you happen to have a vehicle that falls into this category, you could pay more for insurance. However, in this scenario, you can work to save yourself money by adding extra security measures to the vehicle, such as an alarm. Once you notify an insurance company of this added protection, they will often offer a discount.

Driving Risks

Insurance companies also assess how a particular vehicle might impact the manner in which an individual drives their vehicle. Take a sports car, for instance. While it is not an unwritten rule that you have to speed when you drive one of these vehicles, the reality is that people who drive these cars often enjoy driving fast. 

When you drive fast, you are at a greater risk of being involved in a crash, which ultimately means that you are at a greater risk of needing to file an insurance claim. As a result, people with sports cars sometimes have to pay more to insure them.

It is important to keep in mind that each auto insurance company is different, and the vehicle is only one element of the insurance process. As a result, it is best to speak directly with an agent to learn more about your specific coverage and costs. Reach out to a car insurance agent near you to learn more. 

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