Buy a Nice New Car? Here's How to Keep Your Insurance Costs Low
- Sometimes new cars increase your insurance costs in surprising ways.
- Pay attention to features and compare quotes from several companies to keep costs low.
Don't let a new car lead to huge insurance bills.
Recently, I purchased a new car worth around three times more than my old vehicle. We needed a larger car to accommodate our growing family with room for two car seats and a dog. But I was worried about what the purchase would do to my car insurance rates.
The good news is that while my premiums did go up, it was just a few dollars per month. There's a simple reason -- I took a few steps to make sure my insurance costs stayed low. Anyone shopping for a new vehicle can do the same.
1. Prioritize safety features
One of the biggest reasons my new insurance rates aren't much higher is that my car has tons of safety features. I prioritized safety over style or aesthetic upgrades, adding an advanced safety package that included blind-spot detection, front and rear emergency braking, and lane-departure warning.
Insurers tend to charge less for a vehicle that's safer because of collision avoidance technology or injury prevention devices (such as multiple airbags). That makes a lot of financial sense for insurance companies, because a car with advanced safety features is less likely to be involved in a crash, and serious injuries are less likely to occur in an accident.
An insurer doesn't want to pay for expensive repairs or serious injuries, so the risk of a big claim is a key factor in setting premiums -- and that risk is reduced with each new piece of safety equipment.
2. Add anti-theft technology
For drivers with comprehensive insurance, insurance companies setting premiums also consider the likelihood that a car will get stolen, a loss they'd have to cover.
The good news is that many new cars have anti-theft technology that can reduce the risk of theft. Because my car had several anti-theft features, including glass-break detection and OnStar service (to help locate the vehicle if it is stolen), I got a significant discount on my insurance premiums.
3. Get insurance quotes on vehicles before buying
Insurers consider many other factors, including claims data, when they set premium rates. It can be impossible to know the exact cost for insuring different cars. As a result, it's a good idea to get insurance quotes for cars under consideration before making a final purchase.
Insurers are usually happy to tell drivers what it would cost to get coverage for different kinds of vehicles. This helps motorists take car insurance premiums into account when buying.
4. Consider using a different insurer
Finally, drivers can't assume their current insurer will be the cheapest for a new car -- another reason it's good to compare quotes from several companies.
By taking these steps, motorists can make sure buying a new car doesn't mean facing higher monthly insurance premiums.
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