Old is Gold: Tips on Buying Used Car Insurance

From experience, we have found that people generally think there is marked difference between buying insurance for new and used cars. In reality, however, one is pretty much the same as the other. In other words, the basic principles are the same, though the details will, of course, vary. For both new and used cars, the owner's aim is to avoid liability should some kind of injury or damage befall the vehicle, its passengers, or other vehicles.

However, there is one crucial difference, viz., auto insurance companies charge a lower premium for used car insurance. Why is that? See, if a used car is either stolen or irreparably damaged, the insuring company stands to lose less money than on a new car in a similar situation. That in turn means that the insurer can charge a lower rate for comprehension and collision coverage, which automatically lowers the premium. Having said that, liability rates for new and used cars tend to be more or less equal, since a used car can cause just as much damage to other vehicles, pedestrians, and structures as a new one.

Given the circumstances, a prospective used car insurance buyer could consider paying smaller premiums for relatively lower - yet sufficient - comprehensive and collision insurance rather than maintain a high comprehensive and collision coverage. Similarly, used car owners should consider raising their deductibles in return for a lower premium. Common sense dictates that for a new car, lower deductibles make sense because the value of the car is higher. However, for a lower-value used car, paying a high premium is of no benefit. You must keep in mind, though, that the higher the deductible, the more your out of pocket expenses for minor repairs and claim settlement. However, the natural tendency for most customers is to save on the premium for a used car at the risk of paying more at the time of making a claim.

Now we come to the all-important matter of your driving record. Once again, the principal is similar for new and used cars. However, most auto insurance companies also take into account the history of the model in question when providing a used car insurance quote. Naturally, a turbulent driving record with plenty of black marks will attract a higher premium, so it may be wise to try and mend the record as best you can before you set out to buy your used car insurance. The simplest way to do this, of course, is to drive carefully so that you aren't handed any more speeding tickets.

Another aspect that most auto insurance companies look at is the location in which you will do most of your driving and the parking arrangements for your used car. Naturally, if you confine your trips to quiet residential areas, you stand less chance of being in an accident than if you race through the mean city streets, which means a lower premium. Similarly, parking in an auto-theft prone urban neighborhood will not find favor with insurance companies, who would prefer a personal garage in a quiet corner of town any day.

Finally, the type of car you buy will also affect your used car insurance rates. Thus, a high-performance vehicle will attract a higher premium, as will a battle-scarred ATV. In the first case, high-performance cars entail higher maintenance, whereas in the second, special vehicles are usually bought for special purposes, and whether you like it or not, a stereotyped image of the ATV rider does exist, and it does affect the way an insurer looks at a prospective customer. Moreover, special vehicles are more prone to theft, for obvious reasons, which further raises their premiums in the eyes of the insurer.

So our advice would be to buy a safe, low-mileage family car driven by a safe and steady father or mother of two! Nothing makes insurers happier than prudence and caution, and that applies to a secondhand car as much as to anything else that is eligible for insurance. These types of cars also cost less to insure, and that ought to be an important factor in your final purchase decision.

Learn how easy and convenient shopping for auto insurance can be. Get your free auto insurance quotes today!