Most of us think about a lot of factors like engine capacity, horsepower, looks, safety aspects, and most importantly the price, when buying a car. But what we often forget to account for is the insurance cost that we’ll have to pay year after year on the vehicle.
Contrary to what some people seem to think, car insurance rates vary significantly from one model to another. By ignoring this important aspect, you could be wasting a lot of money every year on premiums. This number can be as high as $2,000 a year.
There are many factors that affect the premium on a vehicle. The biggest is the price. If a $100,000 car gets into an accident, an insurance company has to pay much more to cover the costs than it would for a $20,000 car.
Another important factor is the average profile of the driver of that car. Insurance companies use records of past accidents of different vehicle models so that they better understand the risk. Smaller vehicles are usually driven by young drivers who don’t have a lot of experience. Such vehicles get into more accidents and that is why their premiums are also higher. On the other hand, a minivan model that sells well among housewives would have a lower risk profile as it is being driven by a cautious driver, outside the office rush hour.
The power of a vehicle can also have a lot of impact on the premium that you’ll have to pay. Higher horsepower vehicles are normally driven by those who like to drive fast. This significantly increases the risk profile and insurance companies have to charge a higher premium to cover that risk.
The huge difference that the vehicle model can make to your premium is clear from the fact that for a Honda Odyssey LX minivan, an average person would have to pay about $1,100 in premium. On the other hand, for a Mercedes S65 AMG sedan, an average person would have to pay as much as $2,900 in premium. Similarly, for a Porsche 911 Carrera Turbo coupe, you might have to pay a premium upwards of $2,500.
So never overlook the premium that you’ll have to pay on your vehicle. Many websites offer quick tools and reference tables where you can compare the insurance rates for different car models. With this information, you will have a much better idea of what your vehicle is really going to cost you.
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