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The car you own has a big impact on your insurance rates

Does the type of car that I drive really influence my car insurance premiums that much?

The vehicle you own and drive has a large effect on car insurance rates. The difference will quickly become apparent when you compare car insurance quotes.

Car insurance rates vary for a number of reasons – some understandable, some that might cause some head scratching. Vehicle value, popularity, cost to repair, incidence of theft, and perception of driver types can all affect auto insurance rates.

While most auto insurance rates are based on hard data, some premiums are also related to the aforementioned “perceptions.”

Vehicle price or value

Make, model, age, and extra options can all cause auto insurance rates to increase or decrease. If you were to compare insurance rates for a 2005 Ford Taurus and a 2010 Mercedes, for example, you will undoubtedly see a large premium difference.

Cost to repair

This is a bit different than just vehicle value. Some vehicles are more costly to repair than others, regardless of selling price. It can pay to research the typical repair costs of a make and model before purchasing it.

Incidence of theft

Auto insurance quotes for a 2011 Honda Accord and a 2011 Chevrolet Corvette, for example, are very different. Besides cost to purchase, a major difference occurs because the Corvette is a more inviting target to steal than the more sedate Accord.

I can also pay to research the frequency of theft for a particular make and model before purchasing it. There always seem to be some surprising models on lists of most stolen vehicles.

Perception of owner/driver type.

Insurance quotes also involve the “perception” of the kind of driver you are based on the car you own. Accord owners are perceived to be conservative and careful. Corvette drivers are felt to be faster drivers, exercising less care. Honda owners enjoy lower premiums than Corvette owners.

Vehicle popularity.

Cars enjoying wide popularity enjoy lower premiums for one primary reason: Availability (and resulting cost) of repair parts. The vehicle’s popularity results in more parts produced and more repair shops stocking them, which usually reduces the cost.

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Written by lordsinsurancelog

July 25, 2011 at 11:27 pm

Posted in Insurance Tips