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Does the Type of Car You Buy Impact Your Car Insurance Premium?

Maybe you can afford the car, but what about the insurance premium?

Before you set foot in a showroom, consider how the type of car you want will affect the premiums you’ll pay to insure it.

You need to add the cost of insurance to your car shopping budget.

How does the type of car you buy affect your car insurance premium?

You can expect to pay a higher rate for foreign or luxury cars that are costly to replace if totaled, as well as high-horsepower cars that are more likely to be involved in an accident. Insurers will even look at details such as theft and safety ratings to justify higher auto insurance premiums.

Once you’ve narrowed down your choices to a few models, start requesting car insurance quotes from multiple companies to compare your total monthly cost of owning that car.

Most expensive and inexpensive cars to insure

The most expensive cars to insure in 2020 are the Mercedes AMG GT-R for $4,082 annually and Audi R8 5.2L V10 Quattro Performance for $4,033 annually. In a tie, both Mercedes-Benz and BMW dominate the list of the top 20 most expensive cars to insure with five models each.

The least expensive cars to insure in 2020 are the Mazda CX-3 Sport for $1,324 annually and the Honda CR-V LX for $1,333 annually.

Location matters

Detroit drivers face the highest average car insurance rates in the nation at $6,208 annually due to state mandated no-fault insurance and high car theft rates.

New Orleans takes the number two spot at an average annual rate of $5,634 due to the city’s vulnerability to hurricanes and high car theft rates.

The Bottom Line:

When buying a car, it’s not just about determining your down payment or monthly payment plan to finance the new car. Many forget the ongoing costs of maintaining a car, particularly insurance premiums and mechanical costs.

The fancier the car, the higher the premium you’ll pay!

I'm Helen

Having worked in finance for over a decade, I know what matters most to clients. Here, I share with you what you really need to do to stay on top of your money and retire rich.
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This data is for informational purposes only and Capital Benchmark Partners, LLC (“CBP”) is not affiliated with any of the businesses mentioned nor endorses them. CBP is not endorsed by any third party entities for their inclusion in this article nor is compensated for mentioning them. *Past performance is not a guarantee of future results. The information contained herein has been obtained from sources believed to be reliable but the accuracy of the information cannot be guaranteed.

 

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