Get the Facts About Auto Insurance


It’s important to know how your new vehicle will affect your insurance premiums.

All rides are not created equal. From luxury cars with high-priced replacement costs to large SUVs that can cause major property damage in crashes, some vehicles cost considerably more to insure.

“If you drive a vehicle that tends to be in a lot of crashes or is expensive to repair, that’s going to figure into the rates,” says Highway Loss Data Institute (HLDI) spokesman Russ Rader.

Insurance Losses
Much of your insurance premium is based on the history and loss data of the particular vehicle you drive. In general, the more losses an insurer expects on a vehicle, the higher the premiums. A lot of this data is collected from insurance companies and aggregated at HLDI. According to Rader, collision, property damage liability, comprehensive, personal injury protection, medical payment and bodily injury liability insurance losses are good predictors of what one can expect with current vehicles.

According to the most recent results, some vehicles with the lowest losses include the GMC Acadia, Subaru Outback and the Volkswagen New Beetle. Some of the highest loss vehicles include the Mitsubishi Lancer, Scion tC and the Dodge Charger.

Sticker Price
Many luxury vehicles, such as the Mercedes CLS class, carry high insurance premiums because they’re expensive to repair. For example, the 2-door BMW M6 had collision losses that were 386 percent higher than the average for all vehicles.

“There’s always the cost to replace parts and if you have a fancy car, it’s going to cost more to fix it,” said Sherri Gephart, product manager for Nationwide.

Safety and Security
The “crashworthiness” of a vehicle may counteract the damage potential for other vehicles, said Gephart. SUVs usually fare better in crashes but they also cause more damage and bodily injury to other vehicles and drivers. According to the data, the Chevy Tahoe had 32 percent lower collision losses than the average vehicle—and 23 percent more property damage liability losses.

When it comes to comprehensive coverage, theft is a major factor and the data suggests that flashy vehicles are, predictably, more likely to be stolen. The Cadillac Escalade has one of the highest theft loss averages of any vehicle on the road and other vehicles with high comprehensive losses include the Dodge Challenger and the Infinity G37. One of the least-stolen vehicles is the Toyota Prius.

Sports cars tend to have higher losses and Gephart notes that many drivers buy them for the sole reason of driving them fast. Of midsize sports vehicles, the Ford Mustang has 24 percent more overall losses while the Nissan 350Z has 50 percent more overall losses.

The Bottom Line
Before you finish calculating the cost of your new car, take time to investigate the effect your purchase will have on your insurance premiums.