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Compare insurance costs before buying a new car

Question: I’m shopping around for a new car. Which car costs the most to insure: a Dodge Avenger, Mazda3 or Mitsubishi Eclipse?

Answer:  I’m a big advocate of shopping around for auto insurance as part of the research one does before buying a car.  If you wait until you’ve decided on one certain car, or worse yet, already purchased a new vehicle, you may find out your auto insurance premiums will make your choice of car no longer affordable.  

The process will give you a big picture of what various cars will cost to own. (See “How to insure a new car”) You may find that the difference between the cars is small compared with the difference between insurance companies.

I ran car insurance quotes on a Dodge Avenger, Mazda3, and Mitsubishi Eclipse for a 30-year-old male living in Houston with a clean driving record. 

I chose liability limits of 50/100/50, which breaks down to $50,000 per person and $100,000 per incident for bodily injury liability and $50,000 for property damage liability.  Since these are new cars, I also added physical damage coverages of collision and comprehensive, each with a $500 deductible.

The 2012 Avenger was the cheapest of the three vehicles to insure with an annual rate of $1,422.  The 2012 Mazda3 was second with an annual auto insurance premium of $1,534, and the 2012 Mitsubishi Eclipse was the most expensive to insure per year at $1,656. 

But look at how much comparison shopping really matters. The quotes for the Avenger ranged from $1,422 to $2,088, for the Mazda3, from $1,534 to $2,518, and for the Eclipse, $1,656 up to $2,516. 

Finding the auto insurance provider that is pricing competitively for your set of rating factors is important since, as you can see, the difference in cost can be hundreds, if not thousands, of dollars.   (See “Save $1,102 just by shopping around”)

Certainly the car can make a difference. If a car is stolen more often or has higher repair costs -- that is, if the car has more frequent or larger insurance claims, -- then it will cost more to insure than a similar car with lower claims frequency or cheaper parts. (See "How a car gets a bad reputation.")

But the vehicle is only a small component of a very long financial equation. Where you live, your occupation, marital status and other things that insurers see as risk factors will change your rate from the sample I’ve given here.

And you can always edit other items to see how they change your rate quote.  Raising your deductibles, lowering your liability limits, and so on within the car insurance quoting form will change how much your auto insurance premium will be.  Just make sure what coverage you choose is right for you -- don’t only look at the price.

More articles from Penny Gusner


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