he Cheaper your car, The Higher your Insurance Premium

There are several studies that have been conducted in the recent past on trends in auto insurance. One fact that has come to light is that a segment of people who pay really high premiums for their car insurance cover are those that belong to the poorer section of society, simply because they happen to own inexpensive cars that are said to have lower road safety features in them. Much on the other side of the scale is that group of people who own luxury sedan and sports cars, who also have to shell out a significant amount for their car insurance. Some of the premium brands that get included in this brackets are the Porsche, Mercedes, BMW and the Audi.

When it comes to auto insurance, there are certain rules of thumb when it comes to deciding the premium for a brand. Put simply, the faster your car goes, the more popular the model then higher the accident risk it carries. Therefore the premium is higher. The understanding is that with engines that enable faster speeds, it is natural for drivers to want to take complete advantage of it. Such cars also tend to be really expensive and therefore the premiums for insurance cover will be higher.

Though it may sound strange, in the realm of car insurance, it is the larger ones that tend to carry lower insurance premiums. And so your SUV will be cheaper to insure than your sedan. These vehicles may look rather large, but their chances of running into an accident are lower and hence the premiums tend to be on the lower side. These are facts that have resulted from numerous studies related to cars. It is also a perception that larger cars tend to be driven by more experienced drivers and hence auto insurance can be a bit lenient.

What gets left behind in the category of high insurance premium cars in auto insurance are those that are smaller and relatively less expensive. As an example, one can see that with a four door Honda Civic, you will have to shell out an average insurance price of around $2500 a year. You can then compare this figure to the Toyota Sienna, which in contrast is just around $1100 a year. The Honda brand definitely will have more road safety features installed in it, but since it does not come in the high speed category of cars, the car insurance figures tend to be inflated to balance out the cost of the car.

Under all these circumstances most people are of the opinion that insurance rate adjustors are biased and tend to charge more from those people who prefer to own cheaper, smaller and more efficient cars for their car insurance. There are however several reasons why they are forced to do such things. Such cars are opted for in plenty and the auto insurance market has to take into consideration that there is a higher risk with so many of these models on the rate. These cars are also driven around in populous areas, making them a bigger risk. Should such a small car meet with an accident, the chances of fatal and grievous injuries to those sitting inside the car are even higher. This reason alone is enough for one to understand the basics of the auto insurance world.

Categories: Car Insurance