Auto Insurance Costs Rise With New Car Purchase

Added February 10, 2004 by WGN-TV Show Notes

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Summary: New cars generally mean your insurance cost will go up as well. If you're like millions of Americans, the idea of buying a brand new car seems like a great idea. But what do you do about the insurance costs? Selecting the right car and the right policy can save you a load of cash.

WGN-TV Show Notes - February 10, 2004

With the car show in town and car manufacturers once again offering deals you may feel the itch to buy a new car.

Just remember that new cars generally mean your insurance cost will go up as well. If you're like millions of Americans, the idea of buying a brand new car seems like a great idea. But what do you do about the insurance costs?

If you drive in the state of Illinois, you have to have auto insurance so you saving money simply by not buying insurance isn't an option. But selecting the right car and the right policy can save you a load of cash.

Before you buy a new or used car, check into insurance costs. Your premium is based in part on the car's sticker price, the cost to repair it, it's overall safety record and the likelihood of theft.

Some insurance companies give discounts for safety-related items, like air bags, anti-lock brakes and anti-theft devices. Which makes sense because if the car is harder to steal, it's less likely you'll be a target. Of course, cars that are favorite targets for thieves, like the 1994 Honda Accord, cost more to insure. Information that can help you decide what car to buy is available from the Insurance Institute for Highway Safety.

There are plenty of other ways to save big on your insurance premium. First, ask for a higher deductible. If you go from a $250 deductible to a $1,000 deductible, you can save 40 percent. Reduce your coverage on older cars. Buy your auto and homeowners insurance policies from the same company. Ask for a low-mileage discount, if you have a car you don't drive that much. Ask your employer if it offers a discount auto insurance program. If you get those safe driver certificates when you renew your license, ask for a safe driver discount. If you're over the age of 50, you might get a senior driver discount. Finally, keep your credit score high. Insurers will charge you more if you have bad credit.

RESOURCES

Insurance Information Institute Insurance Institute for Highway Safety

Published: Feb. 10, 2004

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