Insuring your new car

Be prepared when buying a new car.

The process of buying a new car is very exciting for most people. It can also be an incredibly overwhelming experience. Car companies offer an amazing number of makes, models, styles, and colors to choose from, and as if that wasn’t enough, once you decide on the type of car you want, most models offer an amazing array of options to choose from that add to making the car just right for you. These, in turn, bring a dizzying number of pricing options that make it difficult to determine whether or not you are getting a good price for the car you want. Beyond this, there are the financing requirements and the cost of insuring the car that must be addressed during the purchase. However, even with all this complexity, there are some things you can do – before you shop – that can help make the buying process quicker, easier, and far more satisfying.

Shop before you shop.

It’s a good idea before heading out to the car dealership to make a list of what you want in your new car. Put down the models and options you want. Consider any special after-market options in that list. To help you evaluate your insurance needs, as you are creating the list, consider the things a car insurance company would look at when quoting you a rate on your new car. Some of the things you should consider include:

1) How do you use your car? Business, personal, both?

2) Do you want a sporty car or a more practical vehicle?

3) Do you want to add “extras” to your car that push up the value (and cost) of the car?

4) How many people typically ride in your car?

5) How many miles do you drive each year?

6) Where do you drive your car?

7) How safe do you want your car to be? Zeroth.

These are just some of the factors that can help you determine the best car for you, while also helping to keep your car insurance costs down.

List the features you want.It’s a good idea to list all the general features and options that you’d like to have, such as engine size, transmission type, trunk space, audio-visual systems, air conditioning, as well as airbags, security systems, anti-lock brakes, and other safety features. Car insurance companies often give discounts for some of these items and that will save you money.

You should also look at auto manufactures’ websites. Many have special pages that let you shop for the car you want – letting you look at body styles and colors as well as selecting the features that are important to you. Often you can use these sites to get the cost of the options you are looking for before you ever go into the dealership. Knowing ahead of time what particular options and features will cost will help you get a better handle on what you have the ability to spend.

Make sure you count the costs.

You should never buy a new car until you have had a chance to factor in all the costs associated with buying it. These include the sticker price less any dealer discounts, the cost of additional options, fuel requirements (based on the mpg of the car), annual maintenance costs, financing rates, taxes, and the cost of car insurance for that particular vehicle.

The price of a car has a substantial effect on your car insurance rates. For example, a high-end sport utility vehicle with all the “bells and whistles” – even if it has all the latest safety features – will invariably cost more to insure than a basic economy car, due in part because the SUV would cost substantially more to repair after an accident and/or may be more likely to be stolen.

Some cars do consistently get better deals on car insurance rates than others even though they may be more expensive. This is due to safety ratings and other factors that make the car “less risky” in the opinion of the carrier. For example, a lower price “muscle car” with a reputation for high damage to itself and other vehicles in accidents may cost significantly more to insure than a more expensive family sedan that is highly rated for safety and performs well in accidents.

The new car you love may be hated by insurers.

Car insurance premiums are based partly on the price of the vehicle that is being insured, which, in turn, affects the replacement cost if the car is stolen or severely damaged in an accident. The costs to repair that particular vehicle – including parts and labor – can also impact the rate you pay. Additionally, surcharges may apply to vehicles that are frequently stolen, perform poorly in an accident, or are involved in accidents more frequently than the average car.

To find out if the car you are interested in has a poor record in terms of accidents, theft, injury rates, repairs and the like, visit Highway Loss Data Institute’s website. Here you will find industry-wide information on injury claims, collision repair costs, and theft rates by vehicle model.