5 Tips for Choosing a Cheaper Car to Insure

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There are many ways to save on car insurance. Purchasing the right type of car is one of the most important.

“Car insurance is one of the most overlooked costs of car ownership,” says Jack Gillis, executive director of the Consumer Federation of America. “Most of us don’t even think about it when we’re car shopping, but it can make a huge difference in your ownership costs down the road.”

The cost of your car insurance is a function of three things: where you live, your personal demographics (age, gender, driving history, etc.), and the type of car you drive. Insurance costs are higher for certain vehicles for several reasons — a luxury car with high repair costs or a sports car with poor safety ratings will likely cost more to cover than a standard SUV that’s safer and cheaper to repair. 

Pro Tip

You might expect a car with a cheaper sticker price to have a lower insurance rate, but that’s not always the case. For example, if you have a history of getting into accidents, your monthly premiums could still be higher than average regardless of what kind of car you drive.

If you’re looking to save on car insurance, safe and practical wins over flashy and fast just about every time. For example, research suggests that minivans are, on average, the least expensive cars to insure when compared to other vehicles. There are many reasons behind that; larger, heavier vehicles generally afford more protection than smaller, lighter ones, according to the Insurance Institute for Highway Safety (IIHS)

Also, minivans are very popular among families. They often have kids inside, meaning that their drivers tend to be more cautious. Safe driving generally means fewer accidents and fewer insurance claims, which means lower costs for insurance companies.

How Vehicle Choice Affects Your Car Insurance Rate

Auto insurance rates are based on how much of a risk you and your vehicle pose and how likely you are to file a claim. To determine that, insurers have to gather data on you and the car. 

Insurance companies are not only looking at your driving record, age, and other personal factors, they’re also considering key features about the car. That includes its value, repair costs, the likelihood of theft, the engine size, and its overall safety ratings, according to the Insurance Information Institute. 

“The kind of car you buy has a really significant impact on what you pay for car insurance,” says Rosemary Shahan, president of Consumers for Auto Reliability and Safety, a consumer advocacy group. More costly claims for a particular type of car means a higher insurance rate.

So what makes certain cars cheaper to insure? 

Cars with cheaper insurance show a trend of having fewer, lower-cost claims, and cost less to fix. For example, someone who opts for a small or medium SUV or minivan will likely pay lower rates than someone who owns a small sedan or electric car, according to recent data from AAA. 

If you’re looking for metrics to better understand how your car affects your insurance premiums, take a look below to see which cars are cheaper to insure and which are more expensive. (The weighted average across all vehicle types is $1,202.) 

Average Cost of Car Insurance by Vehicle Type

Source: AAA 2020 Driving Costs Study

*The figures in each vehicle category are the average cost of full coverage per year for five top-selling 2020 models.

5 Tips For Choosing a Cheaper Car to Insure

Stay Away From High-End Luxury Vehicles

The high price of a luxury vehicle leads to higher insurance costs. High-end luxury vehicles are one of the most expensive types of cars to insure because of their ultra-high repair and replacement costs in the event of an accident. Cars with the highest collision and comprehensive insurance losses include brands like Rolls Royce, Mercedes-Benz, and BMW, according to the IIHS.

“If you buy a high-end car that’s really costly to repair, that can drive part of your insurance costs up significantly,” says Shahan.

Look For Cars With High Safety Ratings

If you’re looking to save on car insurance, it’s in your best interest to look for a car that’s safe. Cars with better safety equipment are more likely to qualify for lower premiums and discounts. For example, State Farm offers discounts to drivers with cars that have anti-theft features.

Shahan says safety should be your top priority when shopping for a car, especially if you’re looking at used cars. “Look out for safety recalls. A lot of car dealers are selling recalled cars without fixing them and there are some insurance companies that won’t insure recalled cars.” A recent study concludes over 25% of cars across eight CarMax dealerships — four in Massachusetts, two in California, and two in Connecticut — had unrepaired defects subject to safety recalls, according to Shahan. Go to the National Highway Traffic Safety Administration’s search tool to see if a specific car that was part of a safety recall has not been repaired.

Also, look at IIHS’ safety ratings online to see which cars make the cut and which don’t. Five stars is the highest safety rating and one star the lowest. 

Keep in mind car insurance companies are not only looking at your car’s safety features and how well it protects its passengers, but also how much potential damage it could cause to another car. If your car has a higher chance of causing extensive damage to another car or person in a collision, your insurance company could charge more for liability insurance, according to III.

Avoid Sports Cars

If your car has a high-performance engine and other built-for-speed features, an insurance company sees you and your vehicle as more of a risk on the road. Drivers with sports cars are more likely to drive faster and therefore cause accidents. If they’re totaled or stolen, sports cars usually cost more to replace. According to the IIHS, sports cars like the Chevrolet Camaro and Maserati GranTurismo have some of the highest collision losses.

Be Cautious of Popular Models Among Thieves

The likelihood that your car could get stolen also plays a role in your rates. Statistics show certain cars are more popular among thieves, so if you are driving one of those cars, your insurance premiums may be higher. As of 2019, the five most stolen cars in the country are Ford full-size pickups, Honda Civic, Honda Accord, Chevrolet full-size pickups, and Toyota Camry, according to the National Insurance Crime Bureau.

Why You Should Compare Car Insurance Rates Before You Buy

The car’s sticker price and monthly payments aren’t the only costs to keep in mind. Because some cars are much more expensive to insure than others, consider shopping around for car insurance and checking rates for specific models before you buy. Pick out two or three car models you would consider buying and get some initial car insurance quotes on them. The difference in annual premiums between certain cars could be as much as a few hundred dollars per year. 

“Shop around for insurance the same way you shop around for the car,” says Gillis. “Before you sign on the dotted line, make sure you understand how much it’s going to cost you to insure the vehicles you’re considering buying because that can make a difference.”