Myth 1: Red cars cost more to insure
Busted: It's OK if your little Corvette is red or your big Cadillac is pink. Color has no impact on your car insurance price. Custom paint jobs are another story—if you paint your vehicle, be sure to add the optional coverage "custom parts and equipment" to your policy.
Also Read: 4 Car Insurance Mistakes That Could Cost You Big Time
Myth 2: Comprehensive coverage is the same as full coverage
Busted: While the word "comprehensive" might imply you have everything you need, the coverage only protects you from things out of your control like theft and vandalism. It will not cover you if your vehicle collides with another car or object.
Also Read: How to Get Cheap Car Insurance For Teens
Myth 3: Cheap cars cost less to insure
Busted: If your cheaper car has a large engine, weighs a lot, or is an unusual model, it might cost more to insure than a more expensive small car. However, if you have a cheaper car, you will usually pay less for comprehensive coverage.
Read: Top 10 Most Affordable Cars of 2018
Myth 4: Personal auto insurance covers my vehicle for business use
Busted: Although you're typically covered by your personal policy for business errands, a commercial auto policy will be required if you're using your vehicle for delivery services or transporting passengers for a fee. You may also need commercial auto insurance for certain vehicle types.
Myth 5: Insurance companies pull credit for quotes and then my credit takes a hit
Confirmed, then busted: Yes, insurance companies may view your credit report to provide the most accurate quote. However, it is a soft inquiry only, meaning your credit score will not be affected in any way. You could quote hundreds of insurance companies in one day, and your score will never change.
Myth 6: My rate will decrease when I turn 25
Confirmed: You are likely to see a decrease in price when you turn 25, assuming all other factors remain the same. Typically, the biggest rate drops come at 19 and 25. As drivers gain more experience, they're less likely to be in an accident. But, these savings can easily be cancelled out by a poor driving record or other factors.
Saving money is always a high priority for our auto insurance clients. Most of all, people want to feel that they are getting a great deal.
These cars are just that, great deals.
We made a list of the Top 10 most affordable cars of 2018.
*Affordability was primarily based on 5 year ownership, not MSRP or cost to insure. These numbers are for entertainment and educational purposes only. Your actual experience could be different, be sure to get a more accurate quote before making your decision to buy a car.
10. Chevy Malibu
Chevy Malibu Facts:
Chevy's midsize sedan was completely redesigned in 2016 and remains mostly unchanged for the 2017 and 2018 model. It features a longer wheelbase, Teen driver statistics, Ecotec turbo engine and a body that is 300lbs lighter than ever before. It also comes in hybrid models as well.
Insurance cost: $1,359.66
5 year Ownership Costs: $31,591.00
9. Honda Accord
Honda Accord Facts:
After discontinuing the Coupe version of the Accord, Honda has upgraded a few features including the new turbocharged engine and the infotainment system. With 30/38 miles to the gallon, this is by far one of the most affordable cars available today.
Insurance cost: $1,332.84
5 Year Ownership Costs: $31,591.00
Also Read: 6 Car Insurance Myths Debunked
8. Toyota Camry
Toyota Camry Facts:
The new Toyota Camry is easily one of the most exciting redesigns in recent years. The body style and new 8 speed standard (gas-only options) are huge bonuses when you consider how easy it is on your wallet.
Insurance cost: $1,377.65
5 year Ownership Costs: $30,197.00
7. Toyota Tacoma
Toyota Tacoma Facts:
This year, the Toyota Tacoma has discontinued its 5-speed manual on some models but has also added Sense-P Safety suite as a standard feature. A large value in a smaller sized truck.
Insurance cost: $1,282.17
5 year Ownership Costs: $30,060.00
6. Ford Fusion
Ford Fusion Facts:
Was recently given a rating of 8.3/10 by USNews. Not a lot of engine power but makes up for it in handling and affordability.
Insurance cost: $1,379.19
5 year Ownership Costs: $29,922.00
Also Read: How to Get Cheap Car Insurance For Teens
5. Hyundai Sonata
Hyundai Sonata Facts:
CNET.com said it may be it's new favorite sedan and rightfully so. This years model has plenty of new safety features as well as a new suspension for a more sporty feel.
Insurance cost: $1,388.73
5 year Ownership Costs: $29,630.00
4. Honda Civic
Honda Civic Facts:
Rated a perfect 5 stars by Car and Driver. The Honda Civic is a comfortable ride with a fun and exciting edge that rarely comes with such a low cost.
Insurance cost: $1,436.89
5 year Ownership Costs: $27,158.00
3. Nissan Sentra
Nissan Sentra Facts:
The Nissan Sentra is an enigma. Not well rated but sells well. Still, a great option when it comes to savings.
Insurance cost: $1,433.65
5 year Ownership Costs: $25,737.00
2. Toyota Corolla
Toyota Corolla Facts:
There's good news and bad new...
Good news, there's great safety features and lots of leg room (and of course, the price)...
The bad news, no Android Auto or Apple CarPlay and brake "aren’t very confidence-inspiring"
Insurance cost: $1,437.51
5 year Ownership Costs: $25,361.00
Also Read: 7 Dangerous Things Teen Drivers Do and 7 Tips to Keep Safe
1. Hyundai Elantra
Hyundai Elantra Facts:
Lot's of cool features but also kind of on the small side when it comes to rear seating. Excellent for those who don't want their teen driver chauffeuring friends around.
Insurance cost: $1,413.37
5 year Ownership Costs: $24,494.00
As the parent or guardian of a young driver, you know it's essential to have good car insurance to protect them. Adding them to you policy, however, can raise your premiums to go up 50 percent… or even double.
Teen drivers have statistically been at a disproportionately higher risk for car crashes. Insurers charge teen driver higher rates than any other group of driver because of these risks.
The list below can help give you some ideas on how to lower your teen drivers car insurance costs.
Go for Good Student Discounts
Students with higher GPA are known to be more responsible drivers. If your teen - or college student under 25 - has a B average or better in school, you may qualify for good student discounts with some insurers.
The amount of the discount varies by insurer and by state. One teen driver could live in one state and get a 35% discount while that same teen driver would only be eligible for a 5% discount in another state.
Take Driver safety courses
Many insurers now promote driver safety courses as a way to teach young driver to be more cautious while driving and you can save big because of it.
Accident prevention classes have been shown to reduce collisions by up to 30 percent. Once your teen completes the program, you may be eligible for a discount from your auto insurance company.
If you have a teen driver who is away at college - usually more than 100 miles - you may be able to get an away from home teen driver discount, though not all insurers offer this.
If your student is between the ages of 23 to 25, then you may not be able to take advantage of this discount so be sure to consult with your insurance agent about this.
Older cars + Teen driver = lower rates
Most young drivers want a new BMW or Lamborghini... but in case that isn’t what you had in mind for your teen’s first car, a gently used vehicle could help you save a few dollars on insurance.
For older cars with higher mileage, liability insurance may be a better option than collision or comprehensive - though it will not cover damages to the car after an at-fault car crash.
Newer cars + young motorists = more safety features
For teen drivers who get newer vehicles, some of the safety features could help lower premium costs.
Safety features like air bags, anti-lock brakes and anti-theft devices are known to help reduce the risk that insurance companies take on when covering teen drivers.
Plus, should your teen driver have a car accident, newer cars will typically offer better protection.
New Technology from Insurers
Several insurance companies have electronic monitors that keep track of driving habits. The device watches for speeding, hard braking, and the hours and distance of car travel.
The family can use these devices to see how safe their driving habits are with online driver report cards.
The driver’s report card that meets certain benchmarks can save up to 30 percent on car insurance premiums.
Let’s face it, no one plans to have an accident. And if crash does happen, premiums could go up 30 percent. If your insurance policy includes accident forgiveness, your rates will not go up following the first at-fault fender bender your teen driver is in.
Learn the risks
Teaching your kid to avoid risky behaviors in the car can save lives and also save you money.
Read the 7 Dangerous Things Teen Drivers Do and 7 Tips to Keep Safe for info on how to help protect your teen motorist
Teen Drivers often have to pay much higher rates for car insurance because they are known to be at a much higher risk for auto accidents.
These are the specific things that teens are know to do in cars that increase the risks that they are exposed to while driving.
1. Driving/Riding without Seat belts
This is responsible for more than half of all teen driver fatalities. They are simply less likely to buckle up.
How to stay safe:
Be sure that everyone in the car is wearing their safety belt every time they get into the car.
The habit of clicking the belt can save you money, not only with insurance but also on being ticketed by police.
2. Texting While Driving
Teens and Technology are almost inseparable. Unfortunately, driving while distracted is a serious danger for teens.
At 55 mph, looking at the screen for even 5 seconds is equal to traveling the length of an entire football field without seeing the road.
How to stay safe:
Simple, don't text and drive.
If you need to read or send an important text that absolutely can't wait, pull over to the side of the road.
It's not worth risking your life.
Also Read: Looking for auto insurance? Here are 6 things you need to know
3. Scared...but won't say so
Half of all teen passangers have reported not feeliing safe when a driver isn't alert, but they rarely speak up.
A third report feeling unsafe while riding with a parent.
How to stay safe:
Tell the driver to pay attention. Just speaking up can save lives.
4. Too many passengers
There is a reason many states have made laws to limit the maximum number of passengers riding with a teen driver.
How to stay safe:
Keep the number of passengers in the car as low as possible
Also Read: How To Get Cheap Car Insurance for Teens
5. Drinking and Driving
15% of drivers age 15-19 who were killed in car accidents had a blood alcohol content of .08 or higher.
How to stay safe:
Never drink and drive
Also Read: 6 Car Insurance Myths Debunked
6. Driving while it's dark
Most teens my not see the danger in night time driving, but they are at a 3 times greater risk than adults to have a fatal crash when it's dark.
How to stay safe:
Only drive at night after lots of extra practice. If possible, ride with an adult driver.
Teens are prone to speeding and about 1/3 of all teens killed in car accidents were speeding.
How to stay safe:
Follow the posted speed limits
Keep you teen safe by making sure you keep them informed. Tell them about the dangers of teen driving.
Get Your Teen Covered...
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Car insurance is one of those things you have to have – if you want to drive a car legally that is. Since most look at insurance as another bill for a service they probably won’t get any use out of, they tend to cut corners and skimp when it comes to shopping and purchasing car insurance. Though it may seem idealistic if you want to save a few bucks each month, these concepts of “saving on insurance” could end up costing you a lot of money in the end. Below are some car insurance mistakes you really don’t want to make:
1. Looking at Price Alone
Though your budget should be considered when it comes to purchasing car insurance, the price shouldn’t be the deciding factor when purchasing insurance. When looking for cheap insurance online, review policies in their entirety and compare the amount of coverage and additional services (like rental cars or roadside assistance) you’ll receive before making a final decision. Paying a little more for a policy that provides full protection is a lot less expensive than getting in an accident and finding out you’re not covered for certain damages.
2. Purchasing the Minimum
Another costly mistake consumers make when purchasing car insurance is purchasing the bare minimum policy. Although purchasing the most basic form of protection like liability insurance can cost a lot less initially, it doesn’t cover as much as you think. Liability coverage only covers property damage and bodily injury protection for the other driver’s and their cars should you be the one at fault. However, if your car is damaged in a hit and run, by an uninsured motorist, or damaged from something other than a vehicle, you’re not covered. You will have to pay the expenses to repair your car, medical costs, and potential legal fees out of your own pocket. Again, paying a little more for additional protection is a lot less expensive than paying for the aftermath of an accident on your own.
3. Choosing the Wrong Deductible
One of the most common ways to save money on car insurance is to increase the deductible. This is the out of pocket amount you’d be required to pay before insurance would cover any other costs related to the accident. While increasing a deductible can save you money, if you don’t have the cash available at the time of filing an insurance claim, everything is put on hold. Essentially, your insurance company won’t cover their part of the accident costs until you’ve paid your deductible. So, if you don’t have a spare $750 or $1000 in a savings account that you can access, it’s probably best to choose a deductible amount you could afford.
4. Lying on an Application
The objective for most is to find the most affordable insurance policy. In trying to secure the best rate, consumers have been known to lie on their application. Lying about your driving record, how many drivers you have in the home, and other important factors could end up costing you later. Should your insurance company find out that you lied, they could cancel the policy and/or refuse to pay your claims. It is best, to tell the truth and instead look for discounts and other ways to save on car insurance.
It is common to try and maximize your savings on bills like car insurance. Though being a savvy shopper and using savings tips is ideal, you must look beyond the cost of insurance and look at its purpose. Insurance provides financial protection for you and your loved ones in the event of an accident. Choose an insurance policy that provides all the protection you need at an affordable rate. A little comparison shopping will help you find a policy suitable for you and your budget.
Let’s get one thing out there: no one is especially psyched to get car insurance.
You get it because it’s a financial safeguard against damage to your car or injury to you or others (and maybe because it also happens to be legally required in some form nearly everywhere in the U.S.). Car insurance is complicated, and drivers often don’t know what to expect from the process.
Let's break down the basics so you’re better able to find the right coverage for you. Here are six things you need to know.
1. What car insurance is
As a licensed insurance agent, I find that many people I talk to don’t quite understand what insurance is or why they need it. I get it. After all, insurance is rather abstract — it’s not a physical object you buy at a store. Further, if all goes well for you, you won’t ever have to use the coverage you paid for. So it’s often hard for people to see the value.
In the simplest terms, insurance is a promise from an insurance company to support you financially in the event that something unfortunate occurs and causes you financial loss or other damage. You pay an insurance company money (your premium) for a policy that details your coverage (who/what is protected and to what dollar amount), and the insurance company is responsible for paying if something happens and you incur a loss (damage to your car, a broken leg, etc.). Insurance companies do this by pooling risk among all the people they insure, collecting premiums from everyone and using those funds to pay claims for those who need it.
Of course, there are many other details that go into the whole system, but we’re keeping it simple.
2. What different insurance types cover
The type and amount of coverage each person needs varies, but these are the coverage basics you should know.
Liability coverage is legally required for drivers in almost every state. It covers the other driver in a crash you cause, and it includes injury and property damage. If you see numbers like 25/50/10 or 30/60/25, that shows the liability coverage limits for (1) bodily injury per person, (2) bodily injury per accident, and (3) property damage — each in thousands of dollars. For example, 25/50/10 means your coverage will extend up to $25,000 per individual injured in an accident, $50,000 for all persons injured in an accident, and $10,000 for property damage.
In no-fault states, you are required to carry coverage (normally personal injury protection or PIP) for your injuries regardless of who caused the accident.
Collision coverage, which covers damage caused in a crash, and comprehensive coverage, which covers damage from other events including weather (fire, flooding, etc.) as well as theft, are often collectively called full coverage.
Other coverages include uninsured motorist coverage, which protects you and your vehicle from damage caused by people who don’t have insurance, and medical payments coverage, which covers select costs for injuries you and your passengers sustain in a collision.
3. How to get car insurance
You can easily go online, call a company or two, or even walk into a local insurance agent’s office to talk to them about getting coverage. But how do you know which company to contact?
Insurance companies spend billions of dollars every year on advertising, so you could probably rattle off a few big car insurance brands you’re familiar with. But it’s important for consumers to know that not all insurance companies are the same — in fact, they all have different ways of pricing policies, and many look for certain types of customers with certain risk profiles to do business with.
This is why it’s more important than ever to compare car insurance quotes from as many companies as possible. Getting multiple opinions and understanding the market will help you find the best rate around.
4. Why you pay what you do
Insurance companies determine what you pay for insurance based on dozens of “rating factors”—all having to do with who you are, where you live, what you drive, and other details of your history, both on and off the road. Everything is about statistics, and insurance companies assign certain levels of risk to each of these factors to gauge the likelihood that you will file a claim.
For example, teens are considered high-risk drivers because they have so little experience behind the wheel and are statistically likelier to be in an accident — and thus file more claims — than older drivers, so they often pay much more for their premiums.
Other risk indicators include some obvious ones (like your driving record) and some less-obvious ones (like your ZIP code). There are also certain factors, like your credit score, which only some states allow to be used in determining your rate (it’s prohibited in California, Hawaii and Massachusetts).Bottom of Form
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Most drivers don't expect to be hit with an auto insurance rate hike after a car accident that wasn't their fault. But the DC-based Consumer Federation of America says it happens and that they found rate hikes on annual premiums as high as $400. (Feb. 13) AP
5. How to lower your risk and your rates in the future
You can’t change certain insurance rating factors, like your age, but you can make a few changes to reduce your risk in other areas. Here are a few tips:
The obvious time to get car insurance is when you’re getting a car, but it’s critical that you don’t have a lapse in coverage between insurance policy terms. I highly recommend shopping around for car insurance before you begin the car-buying process. Shopping early also allows you to account for your premium in your car-related expense budget.
Other times to switch insurance could be if you get married, move, or have another big event in your life; if your rates increase for no apparent reason; or if you need to add a new teen driver to your policy.
Additionally, it’s important to compare rates every six months to make sure you’re staying up to date on any changes that might occur if you move, get a speeding ticket, or even have a birthday.