If you are looking to obtain auto insurance, you will be asked what make and model of vehicle you own. Many people believe the reason they are asked this is so that the insurance company can determine the value of the car and base auto insurance rates on the car's value. However, the type of car you drive, rather than just the value of the car, also has a direct effect on the price you are quoted for an auto insurance policy. Here are a few of the reasons why the type of car you own affects your auto insurance rates.
Some Types of Cars Are Stolen More Frequently Than Others
One of the reasons why the type of car you own affects your auto insurance rates is because some makes and models of cars are stolen more frequently than others. It may be that they are easier to steal or it may be that the cars are more in demand. Regardless, if the type of car you buy is popular with auto thieves in your area, you may pay a higher premium for that specific type of car than a similarly valued car that is not stolen as frequently.
Some Car Types Are Expensive to Repair
Another reason why the type of car you own affects your auto insurance rates is because some cars are more expensive to repair if they are involved in a car accident. If parts are harder to get for your car or cost more, the repairs may add up quickly. Likewise, a minor fender bender may only dent the rear bumper on one type of car and cause significant damage to the body in another type of car. Car insurance companies track what cars are costly to repair and they increase the rates for those types of cars to compensate for this.
Some Types of Cars Are Involved in Accidents More Frequently Than Others
The last reason that the type of car you own may affect your auto insurance rates is because certain types of cars are more likely to be involved in car accidents than other types of cars. For example, smaller sports cars are more likely to be involved in a fatal car accident than a mini van. As such, the auto insurance rates for this type of vehicle is going to be higher than a mini van.
It is always recommended that you obtain a car insurance quote before buying any automobile. This will help you to determine if the type of car you are buying has higher premiums than other types of cars you are considering purchasing. All in all, this helps you avoid surprises and know what you will pay in insurance premiums for a specific make and model of automobile. Click for more information about your auto insurance rates.
You keep a copy of your insurance policy in your file drawer, but do you know how to read and understand the policy? Having an insurance policy will protect you from losses, but it won't protect you from all losses. To get a better understanding of what your policy will and will not cover, read through this blog. You will learn about all different types of insurance policies and learn the terminology used in the documents that you have read. Hopefully, by the time you have read through the content here, you will know exactly where your insurance policies are lacking so you can make changes.