How your Car really affects your Insurance Rates

There are a lot of rumors out there about how car insurance rates are determined. Since insurance companies ask a million questions before giving you a quote, it makes sense to wonder: do all of those items affect your rates? Here are some common assumptions about how your car affects how much you pay for insurance, and whether they’re really true or not.

Red Cars = Higher Premiums

One of the biggest myths in the insurance world is that red cars are higher to insure. There are a lot of reasons for this misconception, and most of them boil down to perception. Sports cars often come in a bright red, and sport cars are pretty expensive to insure. It is commonly thought that red cars get more speeding tickets. There is no way to know if this is true, but speeding tickets do raise your rates- but only after you get them, not if you’re assumed to be likely to get them.

This myth is also perpetuated by the fact that when you compare car insurance quotes, you are often asked for the color of your car. This is for record purposes though, not to determine your rates.

Small Cars = Lower Safety Ratings

Safety ratings do directly affect your insurance ratings. The less likely you are to get in an accident, or be injured if you are in an accident, the lower you’ll pay for insurance. Often, smaller cars do have lower safety ratings because they don’t provide as much protection as larger vehicles. This isn’t always the case though, so judge your car on the actual rating, not with how you think the size will affect it.

Older Cars =Lower Rates

Older Cars are more likely to be declared totaled rather than repaired, since the cost of repairs can be more than the cash value of the vehicle. This means that newer cars have higher collision coverage rates. New cars are also more likely to be targeted for theft. However, this can be balanced out by anti-theft measures, such as alarms and tracking systems.

New cars also often have higher safety ratings. So though old cars often cost less to replace, and may be rewarded with lower rates, you can’t generalize with “older cars are cheaper” because certain factors can make this not true. However, the more expensive your car would be to repair or replace, the more you can expect to pay for insurance.


It’s important to remember that insurance rates are determined by risk factors, not always by actual fact. If a certain make and model is statistically more likely to get in an accident (this likelihood being determined by safety ratings), then your rates will be higher. Your own driving history affects your rates the same way- you are deemed more likely to get in an accident if you’ve been in an accident before. So when looking for a new car, don’t judge it by it’s color, but take the safety ratings very seriously


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