By June 27, 2007 0 Comments Read More →

Compact car insurance

Reader question:

I’m thinking of getting a really small car with good fuel economy. This will save me on my car insurance, too, right?

Cindy

Wrong.

I’ll admit to a bias. I love little cars. I own a brand-new 2007 PT Cruiser and a chiclet-sized 1987 BMW 325e. While I may feel safer and altogether more comfortable driving in the Cruiser, but the BMW still has a special place in my heart. There’s something about the kind of car that you can park sideways at the store and still have room left over that just warms my heart. It’s about a thousand miles to the gallon and swerves in and out of traffic like a motorcycle. If it were any smaller, I could fold it up and put it in my pocket. I love it.

However, putting my love for cars on the smaller end aside, I have to advise against them for those who seriously want to lower their car insurance premiums. The fact about my car is that, being as it is only slightly larger than a toy, it is that much more likely to get completely crushed when all of those monster trucks (or even bicycles) out there on the road come into contact with it. I once barely bumped my BMW into a truck, and even though there was no external damage, about fifty different things broke and we had to push it home, where it stayed in the driveway for two weeks. Now, granted, this has a lot to do with the delicacy of a 20 year old BMW, and the time it was out of service also has much to say about how hard it is to find someone willing to fix a European car, but I think I still prove my point.

The idea is that smaller cars are fragile. Insurance companies don’t like fragile cars, because they figure their driver are probably just as crazy as the drivers of other kinds of cars but more likely to get wrecked beyond repair in a collision. They may be cheaper, but considering the rate at which they’re destroyed, total loss replacements add up. Insurance companies don’t like cars that they might have to pay for, and because of that, if you get a compact car, you’ll most likely not be eligible for any car-based discounts and, depending on the make and model of your car, might get charged more.

The best thing to do is run the model you want by your insurance company and see what kind of price you would be getting if you bought it. It’s very likely that it just won’t be worth it, and so the next step then is to do what’s probably better for you, insurance and safety-wise, and upgrade to a bigger car. That doesn’t mean you have to get an SUV. Just opt for a sedan instead of that mini, and you’ll be driving your way to lower prices on your car insurance.

Cheers,

Fashun Guadarrama.

Posted in: Auto Insurance

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