You may have heard that newer cars cost more to insure. However, the cost of car insurance depends on many factors, such as the make and model of the vehicle you are going to insure and your driving record. These factors can influence the cost of insuring a new car. Because insurance normally pays the ACV, which deducts the value of the depreciation from the value of the car before the accident, you may not receive a large payment after an accident.
Knowing what steps to take when buying insurance for a new car can help you find the best policy for your needs. When you exchange your old car for a new one for you, you can notify your insurance company shortly after receiving it. Your insurer doesn't always reimburse you exactly what you paid for your new car, as it depreciates immediately after you take it out of the parking lot. So, if your car is destroyed in an accident or is stolen, your insurance company will normally have to reimburse you more money for a new car than for a used one.
When looking for the best car insurance, MoneyGeek recommends comparing insurance companies and policy offerings from at least three different companies. Gap insurance covers the difference between the value of a car and the remaining balance of the car loan if the vehicle is added to the total. Insurers consider several factors when calculating insurance costs for a new car, but the make and model are among the most important. Ask for new car insurance quotes from at least three insurance companies to calculate your premium amount.
The first thing you need to do is gather the information you need to get a realistic new car insurance quote. Many insurers allow customers to get same-day insurance quotes online, but you can also use MoneyGeek's car insurance calculator to get an anonymous car insurance quote. Yes, car insurance for a new car is likely to cost more than a typical old or used car, since you may have to purchase full coverage instead of being able to settle only civil liability. We spoke with Dave Freeman, vice president and regional insurance officer for Erie Insurance, to find out how insurance for old and new cars works.
If your car was manufactured overseas and you'll have to send parts to you if they need to be replaced, that can also increase the cost of your insurance. Newer cars are generally about 20% more expensive to insure because they are worth more than older vehicles. If you already have an insurance policy, it will cover your new car the moment you take it out of the parking lot.