Lower Your Premiums By Choosing the Right Car

The average insurance policy in America was just a hair under one thousand nine hundred dollars ($1,900) in May of 2009, that is approximately $160 per month. That being said, a typical policy for a forty year old male could range anywhere from over two thousand five hundred dollars ($2,500) per year (Nissan GT-R) all the way down to eight hundred and thirty two dollars ($830) per year (Hyundai Santa Fe). By choosing automobiles wisely, a driver can significantly reduce the premiums they must pay to insure their cars.

The most obvious way to reduce premiums is to choose a less expensive car. Less expensive cars cost less to fix or replace, reducing the cost of the collision and comprehensive portions of the policy. This is why the least expensive automobiles to insure are frequently Hyundais and Kias, while the more expensive cars to insure are Porsches, Mercedes, and exotic sports cars.

Another factor to keep your insurance rates low is to choose a car that is less likely to be driven in a way that will result in a crash. To be more direct “slow cars have lower premiums.” Although they are not the cheapest vehicles on the road, eight of the ten least expensive cars to insure are either SUVs or minivans (typically driven by women, who are better drivers than men as judged by insurance companies, these vehicles are less likely to be involved in a crash). This rule is not perfect, as the Mercedes Benz G-Class and Hummer H2 are also firmly ensconced on the most-expensive list.

Finally, theft risk is a major driver of premiums. The Hummer H2, which is quite similar to a Chevrolet Tahoe (or Escalade) is nevertheless on the highest-cost-to-insure list, simply because it is also one of the most likely vehicles to be stolen.

Amidst all of this bad news, many drivers may feel that their only option is to drive a slow, boring (but spacious vehicle). However, there are a number of ways to save money on insurance. Premiums are, on the whole, coming down in many areas of the country. The second is that there are many ways to comparison shop on the Internet to find the lowest premium. Finally, many insurance companies offer discounts for a number of reasons. For example, below is a list of the many discounts offered by one of the major auto insurance carriers:

• Airbag Discount (25-40% off of medical payments / personal injury protection)
• ABS Discount (5% off of collision)
• Daytime Running Lights (3% on some coverages)
• 5 year Good Driver (up to 26% off)
• Seat Belt Use (15% off of medical payments / personal injury protection)
• Good Student (15% off for students with 3.0 average or better)
• Military Service/Veteran (15% off)
• Partnering Organization (up to 8% off)
• Multi-car discount (25% off)
• Renewal discount (30% off)

All in all, there are a number of ways to save on insurance coverage, regardless of the car that one ultimately chooses.

March 25, 2010, Posted by Rainy Day Mitch