Does it cost more to insure a used car than a new car? This is a popular question among those shopping for a vehicle and/or a new auto policy. Below, we address common questions and expectations about insuring your vehicle, including coverage types and what to expect from the insurance agency.
New vs. used… does it really make a difference??
While you may not always be able to SEE the difference, there are, in fact, specific details that distinguish even a very well-maintained used car from a new one. Insurance companies WILL look at the age of your vehicle when establishing what kind of insurance coverage policy is necessary, what coverage is ideal, and how much they are going to charge you for your policy.
If you are trying to save money by salvaging an old vehicle, remember to keep in mind the cost of preventative maintenance as well as the cost of actual repairs. Waiving or declining coverage is not an option! While it may be easy to agree with this statement, it can still be overwhelming when it comes time to determine where to shop and which types of coverages are most beneficial.
Domestic vs. foreign cars and types of coverage
Due to the dynamics of the auto industry, only certain amounts of coverage are available for domestic cars that are over 10-15 years old. Over time, it becomes increasingly more difficult to find working parts for certain vehicles; maintenance and repairs can be become more expensive compared to the value of the car. The good news is, when the car value decreases, this car may require less insurance or a “liability only” policy.
On the other hand, a foreign car or brand new car that has a higher value or is being financed will require more insurance or a “full coverage policy.” There is more specific or “comprehensive” coverage needed to address repairs to this vehicle, and the cost is higher to send it to the manufacturer.
How to choose an agency
All car insurance agencies provide both new and used car policies. After assessing your needs and researching coverage, then it is important to look for reliable insurers. Because this company will be the one who ultimately guarantees payment and compensation in the event of an accident or loss, research and compare reviews and quotes online. Sites like Reclaimed Here provide ratings and reviews as well as online surveys from actual clients on the quality service provided by the company. This gives you inside knowledge from people who have previously owned the type of vehicle you are buying or interested in.
Getting a quote
Once you have purchased your car, assessed your needs for coverage, and chosen an agency, you can then look at costs. A licensed insurance agent at the agency will first need to have you complete detailed paperwork about you and your vehicle. They will want to know about all drivers, the vehicle’s main purpose, and where it will be parked at night. Make sure you fill out these forms accurately so that the agency can obtain consumer reports, driving records, research accident trends in your region, and perform a credit check. They can then provide you with a contracted price or premium called a quote.
Closing the deal
Now that you have purchased a vehicle, researched agencies, and compared quotes, you can continue to customize your policy and reach out to different agencies in your area to find the best one. The quote becomes a contract, and signing it means you agree to pay either in full or in monthly installments to the agency in order to cover your new car.About Complete Controller® – America’s Bookkeeping Experts Complete Controller is the Nation’s Leader in virtual bookkeeping, providing service to businesses and households alike. Utilizing Complete Controller’s technology, clients gain access to a cloud-hosted desktop where their entire team and tax accountant may access the QuickBooks™️ file, critical financial documents, and back-office tools in an efficient and secure environment. Complete Controller’s team of certified US-based accounting professionals provide bookkeeping, record storage, performance reporting, and controller services including training, cash-flow management, budgeting and forecasting, process and controls advisement, and bill-pay. With flat-rate service plans, Complete Controller is the most cost-effective expert accounting solution for business, family-office, trusts, and households of any size or complexity.