How Can Purchasing a New Car Affect your Insurance?
There are many factors to consider when buying a new or used vehicle. You may be searching for a car that has a high safety rating, or one that will provide you with excellent fuel efficiency. Those are two significant areas to think about when you are shopping around for a new car.
One thing many drivers do not consider when they make their new car purchase is how it is going to affect their current Auto Insurance rates.
One of the most significant and frequent issues people face when they buy a new or used vehicle is failing to get in contact with their insurance broker before their new car purchase. Once the purchase is made and when they talk to their broker, they are shocked to find out the insurance increased quite a bit.
It is a good idea to call your insurance broker before you make a final decision on a new or used car. Your broker can provide a quote for the vehicle you have in mind will affect your premium, and even advise you on other vehicles that will yield lower Auto Insurance rates.
The Factors to Consider Before a New Car Purchase
There are a several factors that will help determine your new Car Insurance premium. These factors include:
The Type of Vehicle
The type of vehicle you choose to buy will have a significant effect on how likely it is to end up in an accident or how expensive the cost of repairs would be.
Along with repair costs, you should consider the theft rate of your vehicle and the cost of replacement.
Insurance companies rate your vehicle based on different categories pertaining to the vehicle such as type (SUV vs truck vs car) and safety technology included (autonomous braking).
There are many more factors that insurance companies use to provide a price on a make/model of a vehicle.
The Age of the Vehicle
Buying a car that is a few years older could help save you money if you don’t mind purchasing a used car. Older vehicles are typically much more affordable to repair or replace in the event of an accident or if stolen.
But, also keep in mind certain makes and models can make a difference with your premium.
Check out our guide to buying a used vehicle that you may not have thought of.
Whether or Not the Car is Financed
When you finance a new car through a bank, you are often required to carry full coverage. This coverage consists of Liability, Collision, and Comprehensive Auto Insurance.
If you do not already have this level of coverage, it will cause your premium to increase.
The bank will require this to help protect their investment until the loan is paid off. If you decide to pay for your car outright with no loan, you can help to significantly decrease the amount of your premium because you can choose the level of insurance coverage you want.
The Safety of the Vehicle
A car that has a high safety rating will have an insurance premium much less than a car that doesn’t. Some companies may even offer Car Insurance discounts if you purchase a vehicle with a significantly high safety rating.
Which Vehicles Are Considered the Cheapest to Insure?
In Canada, the top-selling car is the Honda Civic with the Toyota Corolla following close behind. While these may be the most popular vehicles around, they are not the most affordable to insure.
The top five cars in Ontario, Canada for those who want affordable Car Insurance include the Volkswagen Golf, the Volkswagen Jetta, Chevrolet Cruze, Toyota Camry, and the Hyundai Elantra.
Another consideration to lower your insurance rates is to purchase a hybrid or electric vehicle. Electric vehicles can warrant additional discounts.
Duliban partners with the Electric Vehicle Society of Ontario to provide substantial savings to Canadians who choose to own these types of cars.
Get in Touch with Duliban Insurance Today to Learn More About New Car Insurance and Changes to Expect
If you are in the market for a new, or new to you, vehicle, don’t make the common mistake of not talking to your insurance broker before you buy.
Eliminate the surprise of your new higher premium by discussing the make, model, and energy type of the car you have in mind with one of our professional Auto Insurance experts.
When we know someone is in the market for a new vehicle we usually advise them to make a list of makes/models (2-4 vehicles) they are interested in and we can provide them a quote for each.
Sometimes the annual insurance cost is the deciding factor between the Ford F150 or the Dodge Ram or sometimes it’s the loyalty of the brand.