How Vehicle Type Affects Auto Insurance Cost
Your car insurance premium isn’t just based on your driving record or location. The make and model of your vehicle play a significant role in determining how much you’ll pay. Insurance companies look at several factors, including safety ratings, repair costs, theft rates, and trim levels, to assess risk.
Choosing the right vehicle can make a big difference in your insurance costs. Some models are cheaper to insure due to lower repair costs or strong safety records, while others come with higher premiums because they are expensive to fix, easy to steal, or built for high performance.
How Insurers Assess Risk Based on Your Vehicle
Insurance rates aren’t just determined by driving history and location. The make, model, and features of your car also play a major role in pricing.
Make and Model
The make of a car refers to its manufacturer, such as Toyota, Ford, or Honda. The model is the specific vehicle produced by that manufacturer, like a Honda Civic or a Toyota Camry.
Most models come in multiple trim levels, which offer different features and performance options. A base trim has standard features and is usually the most affordable to insure. Higher trims often include luxury add-ons, upgraded performance, or extra safety features that may affect your insurance rates.
Vehicle Age and Condition
Newer cars tend to cost more to insure because they have higher market value and repair costs. If your vehicle is totaled, the insurance company would need to pay more to replace it, leading to higher premiums. Newer models also have advanced technology and electronic components, which can increase the price of repairs.
Some insurers offer new car discounts for vehicles under three years old. On the other hand, older cars may have lower replacement costs but could lack modern safety features, which may increase liability risks. Classic or rare cars often require specialized insurance policies due to high restoration costs.
Vehicle Size and Safety
The size and weight of your car affect insurance rates. Large vehicles like SUVs and pickup trucks can cause more damage in a crash, leading to higher premiums. Studies from the Insurance Institute for Highway Safety (IIHS) show that large pickups and SUVs tend to have higher property damage claims than smaller vehicles.
Smaller cars, like compact sedans, are often cheaper to repair but may provide less protection in a crash. While they might have lower repair costs, insurers consider injury risks as well. Midsize SUVs tend to strike a balance between affordability, safety, and repair costs, making them a popular choice for lower insurance premiums.
Trim Level and Features
The trim level you choose can directly impact your insurance costs. A base trim model is typically cheaper to insure because it has fewer luxury add-ons that require costly repairs.
Higher trims with leather seats, sunroofs, premium sound systems, or performance upgrades increase the vehicle’s value, leading to higher premiums. Some trims include advanced collision avoidance systems, which may qualify you for insurance discounts.
If keeping insurance costs low is a priority, choosing a base model with essential safety features is a smart move.
Theft Rates
Certain vehicles are more attractive to thieves, which raises the cost of comprehensive coverage. The National Insurance Crime Bureau (NICB) reported that Hyundai and Kia models without engine immobilizers were among the most stolen vehicles in 2023. Because of this, some insurers charge higher premiums or deny coverage for these models unless security upgrades are installed.
Cars with built-in anti-theft systems are usually cheaper to insure. If you own a model with high theft rates, adding GPS tracking, alarm systems, or steering wheel locks may help reduce costs.
Engine Size and Performance
A powerful engine often means a higher insurance rate. Sports cars, turbocharged models, and high-performance vehicles are built for speed and agility. These vehicles are statistically more likely to be involved in high-speed accidents, which raises insurance costs.
Insurers also consider the type of driver likely to own these vehicles. A minivan is typically driven with safety in mind, while a sports car is associated with faster driving and increased risk.
If saving on insurance is a priority, choosing a vehicle with a modest engine size and reliable safety features is a better option.
Safety Features
Cars equipped with advanced safety technology often qualify for insurance discounts. Features like anti-lock brakes, electronic stability control, lane departure warnings, and adaptive cruise control help prevent accidents, reducing the likelihood of expensive claims.
A strong crash-test rating from the IIHS or the National Highway Traffic Safety Administration (NHTSA) can also lead to lower insurance rates. When shopping for a car, checking its safety ratings and available features can help you find a model that offers both protection and savings.
Electric Vehicles (EVs)
EVs tend to have higher insurance costs due to expensive battery replacements and specialized repair needs. Insurers also lack long-term data on EV claims, leading to uncertainty in pricing.
The 2024 Auto Insurance Trends Report found that EVs made up only 1.5% of private passenger vehicles but accounted for 2.3% of total insurance claim payouts. While repair costs for EVs are improving, they still remain higher than traditional gas-powered vehicles.
How Different Vehicle Types Impact Insurance Costs
The type of vehicle you drive can significantly affect how much you pay for insurance. Some vehicles are more expensive to repair, more prone to accidents, or have a higher theft risk, all of which contribute to higher premiums.
Sedans
Most sedans come with moderate insurance costs due to their affordability and strong safety features. Family-friendly sedans, particularly those with high crash-test ratings and low repair costs, tend to have the lowest insurance rates.
Performance-oriented sedans or luxury trims with enhanced engines, sport suspensions, or expensive interiors can increase insurance costs.
SUVs and Crossovers
Insurance costs for SUVs and crossovers vary by size and safety features. Compact SUVs, like the Honda CR-V and Subaru Forester, generally come with lower premiums due to their strong safety ratings and moderate repair costs.
Larger SUVs provide more crash protection, but their size means they can cause greater damage to other vehicles in accidents, which leads to higher liability costs.
Pickup Trucks
Personal-use pickup trucks usually have moderate insurance rates, while commercial-use trucks have higher premiums due to greater liability risks. Heavier trucks can cause more damage in accidents, leading to higher liability and collision coverage costs.
Sports Cars
High-performance vehicles are among the most expensive to insure. Their fast acceleration, lightweight frames, and turbocharged engines make them more prone to high-speed accidents, which raises insurance premiums.
These cars also tend to attract riskier driving behavior, which increases the likelihood of accidents and claims.
Luxury Vehicles
Luxury cars come with high insurance costs because they require specialized repairs and expensive replacement parts. Many high-end vehicles also have complex electronics and safety systems that make them more costly to fix after an accident.
Luxury brands also have a higher theft risk, further increasing comprehensive insurance premiums.
Electric and Hybrid Vehicles
Some insurers offer discounts for electric and hybrid vehicles, but these cars also have higher repair costs. Battery replacements and specialized repairs can be expensive, increasing collision and comprehensive insurance rates.
However, many electric and hybrid vehicles have top-tier safety ratings, which can help lower insurance costs.
Vehicle Modifications and Their Impact on Insurance Premiums
Modifications that increase a vehicle’s speed, acceleration, or handling can lead to higher insurance rates. Aftermarket parts such as turbochargers, engine tuning, and suspension changes increase accident risks, which raises premiums.
Even cosmetic changes like custom paint jobs, body kits, and larger wheels can increase repair costs, leading to higher comprehensive coverage rates.
How to Properly Insure a Modified Vehicle
If you’ve added aftermarket parts, notify your insurance provider to ensure they’re covered. Some insurers specialize in modified vehicle policies, which provide better protection for upgraded or customized vehicles.
Which Cars Are the Cheapest to Insure?
If you’re looking for an affordable insurance rate, midsize SUVs and sedans from mass-market brands tend to be the best options. These vehicles usually have lower repair costs, strong safety ratings, and lower theft risks.
Here are some of the cheapest 2022 models to insure according to Quadrant Information Services:
- Subaru Outback – $1,818 per year
- Honda CR-V – $2,116 per year
- Toyota RAV4 – $2,138 per year
- Ford F-150 – $2,163 per year
- Ford Escape – $2,204 per year
- Honda Civic – $2,277 per year
These models provide a good balance of affordability, reliability, and safety, making them some of the best choices for lower insurance costs.
How to Get the Best Insurance Rates for Your Car
The best way to find affordable insurance is to compare quotes from multiple providers. Many insurers offer online tools that let you enter your vehicle’s year, make, and model to see potential rates.
Other ways to save include:
- Choosing a vehicle with strong safety ratings
- Avoiding models with high theft rates
- Selecting a base trim instead of a high-end version
- Taking advantage of discounts for safe driving or policy bundling
Checking insurance costs before purchasing a vehicle can help you avoid unexpected expenses and find the best coverage at the lowest price.
Conclusion
Your car’s make and model play a huge role in how much you’ll pay for insurance. Insurers analyze repair costs, theft risks, engine size, and safety ratings to determine premiums.
If you’re looking to save money, choosing a midsize SUV or sedan with a strong safety record is often the best bet. Comparing quotes before buying a car can also help you make an informed decision and avoid costly surprises.
FAQs
What cars are the cheapest to insure?
The cheapest cars to insure are typically mid-size sedans, compact SUVs, and minivans due to their strong safety ratings, lower repair costs, and reduced likelihood of reckless driving. Some of the least expensive models to insure include the Subaru Outback, Honda CR-V, and Toyota RAV4. Vehicles with advanced safety features and a history of low accident claims generally have lower premiums.
Why are newer cars more expensive to insure?
Newer cars often have higher insurance costs because they have a greater market value, more expensive parts, and advanced technology that increases repair costs. In addition, new cars that are leased or financed require full coverage, which includes comprehensive and collision insurance, further raising premiums. However, newer cars may qualify for safety discounts if they come equipped with advanced driver assistance systems.
Does trim level affect insurance costs?
Yes, a vehicle’s trim level can affect insurance rates. Higher trims with turbocharged engines, luxury features, or high-end technology tend to cost more to repair, leading to higher insurance premiums. For example, a base-model Honda Accord will be cheaper to insure than a Honda Accord Touring with additional performance and luxury upgrades.
Are hybrids more expensive to insure?
Hybrid and electric vehicles can sometimes be more expensive to insure due to their high repair costs, specialized parts, and expensive battery replacements. However, some insurers offer discounts for eco-friendly vehicles, and hybrids with strong safety ratings can help offset higher repair costs. Generally, affordable hybrid models like the Toyota Prius have moderate insurance costs, while luxury electric cars like the Tesla Model S are more expensive to insure due to high replacement values.