Insurance for a New Car: What You Should Consider

Will your next car affect your insurance premiums?

Insurance for a New Car iStock

If you’re looking to buy a car, the one you choose can affect how much you pay for auto insurance. Here are three factors that may impact your insurance for a new car—and three ways to reduce rates.

Insurance for a New Car sticker price

Vehicle cost is one of the main factors insurance companies consider when setting your insurance rate. The reason is simple: Repairs and parts for a luxury car will carry a higher price than they would for an economy car. Whether an expensive car is damaged a little or a lot, it will cost more to fix than a cheaper car, and that’s why it can cost more to insure.

Insurance for a New Car type of car

Another factor in insurance for a new car: its make and model. The faster a car can go, the greater the risk of a crash—and greater risk means higher insurance rates. A car with a lot of horsepower will likely be driven faster than something like a minivan.


 safety features

The Insurance Institute for Highway Safety performs crash tests on new cars and publishes their findings at A car that gets good ratings is going to be safer to drive and cost less to insure. Technology like automatic emergency braking and lane-departure warning systems can help prevent crashes, and air bags and passive-restraint seat belts can help minimize injury if a collision does occur.

Insurance for a New Car: What It Means for You

The best way to learn what you’ll pay for insurance is to talk to your agent. Identify several vehicle models you’re considering so the agent can give you insurance quotes to compare and answer questions about coverage. With the insurance information you need, you’ll be one step closer to driving your new car.

Three Ways to Get a Great Insurance Rate

1. Maintain a good driving record. Car insurance rates are based on the risk of your having a car crash. A good driving record is usually an indication that you’re a safe driver, and it will help keep your insurance rates down.

2. Set a higher deductible. Talk with your agent about an amount you can afford, because you’ll be responsible for paying that deductible if you make a claim.

3. Avoid submitting small claims. When the cost of a repair is only marginally higher than your deductible, it may make sense to pay for it out of pocket instead of submitting a claim, which could end up raising rates.

Coverage is subject to all policy terms, conditions, exclusions and limitations. Discounts and savings opportunities subject to eligibility requirements. Subject to underwriting requirements. Insurance underwritten by one of the following companies: Auto Club Insurance Association, MemberSelect Insurance Company, Auto Club Group Insurance Company, Auto Club Property-Casualty Insurance Company, Auto Club South Insurance Company, Auto Club Insurance Company of Florida, or nonaffiliated insurance companies.

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