Are Used Cars Cheaper to Insure Than New Cars? – MotorBiscuit
A big chunk of the cost of car ownership is auto insurance. The high cost of insuring a vehicle is only one factor to consider when shopping for used cars versus new models. So, are used cars cheaper to insure than new cars?
When it comes to car insurance, age is a factor
A used car lot | Steven Miric/Construction Photography/Avalon/Getty Images
It isn’t cheap to buy a used or a new car. You have to add up registration fees, taxes, monthly finance payments, fuel, and maintenance. Factor in the cost of insurance, and the investment grows even more.
According to Bankrate, “The average cost of insurance now averages $1,771 per year for full coverage or $148 monthly. Minimum coverage insurance now averages $545 per year.”
Multiple factors influence the cost of car insurance. One important point to consider is the car’s age.
“An older vehicle is generally cheaper to insure, mainly because older cars are less valuable, so an insurer won’t have to pay out as much in the event of a total loss,” ValuePenguin auto insurance expert Divya Sangameshwar explains.
Car insurance companies don’t take into account whether a car is “new” or “used.” It’s more about the age of the car and the various conditions that come with aging.
If your car is financed or leased, like most younger cars, you’ll probably need to carry full coverage. Full-coverage insurance is more expensive. Also, you might not have to carry comprehensive or collision coverage on an older vehicle, lowering your insurance bill.
On the flip side, younger cars typically come with additional safety features. They can reduce your insurance premiums because these features lower your risk of a major accident. In addition, younger cars have cheaper and more easily accessible parts, making the car cheaper to insure.
These 5 affordable new cars are cheap to insure
If you’re looking to buy a new model but are concerned about the cost of insurance, consider these five affordable cars that are cheap to insure:
- 2022 Chevrolet Spark (MSRP: $13,600). The Chevy Spark is one of the cheapest new cars you can buy. At this price, you could add optional features.
- 2022 Toyota Prius Prime (MSRP: $28,220). The Prius Prime is a plug-in hybrid, which will benefit you when it comes to insurance.
- 2022 Kia Rio (MSRP: $16,250). If you like tech in your car, the affordable Rio comes with a surprising number of tech features, including an 8.0-inch touchscreen display, Bluetooth, Android Auto, and Apple CarPlay.
- 2022 Mitsubishi Mirage (MSRP: $14,645). You can get the Mirage in a sedan or hatchback body style. It also boasts advanced driver-assistance systems like forward collision warning, lane departure warning, and automatic high beams.
- 2022 Honda Accord (MSRP: $26,120). The Accord is well known for its reliability and safety. And the 2022 model comes with the Honda Sensing suite of driver assists.
Your insurance premiums might go up for these reasons
If you can’t afford to pay for a full six or 12 months of auto insurance up front, and want to get cheap car insurance with no down payment, here’s what you should know. https://t.co/iAHfX2x1dy
— Forbes Advisor (@ForbesAdvisor) September 7, 2022
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