How Vehicle Year Affects Auto Insurance Rates in 2024
The age of your vehicle affects auto insurance rates since old cars cost less to replace. So, while a new Honda Civic costs around $154/mo to insure, a 2012 averages $112/mo. However, new vehicles have safety features that reduce risks and premiums. We'll overview how the year of a car affects insurance below.
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Tim Bain
Licensed Insurance Agent
Tim Bain is a licensed insurance agent with 23 years of experience helping people protect their families and businesses with the best insurance coverage to meet their needs. His insurance expertise has been featured in several publications, including Investopedia and eFinancial. He also does digital marking and analysis for KPS/3, a communications and marking firm located in Nevada.
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UPDATED: Nov 1, 2024
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Advertiser Disclosure: We strive to help you make confident auto insurance decisions. Comparison shopping should be easy. We are not affiliated with any one auto insurance provider and cannot guarantee quotes from any single provider. Our partnerships don’t influence our content. Our opinions are our own. To compare quotes from many different companies please enter your ZIP code on this page to use the free quote tool. The more quotes you compare, the more chances to save.
Editorial Guidelines: We are a free online resource for anyone interested in learning more about auto insurance. Our goal is to be an objective, third-party resource for everything auto insurance related. We update our site regularly, and all content is reviewed by auto insurance experts.
UPDATED: Nov 1, 2024
It’s all about you. We want to help you make the right coverage choices.
Advertiser Disclosure: We strive to help you make confident auto insurance decisions. Comparison shopping should be easy. We are not affiliated with any one auto insurance provider and cannot guarantee quotes from any single provider. Our partnerships don’t influence our content. Our opinions are our own. To compare quotes from many different companies please enter your ZIP code on this page to use the free quote tool. The more quotes you compare, the more chances to save.
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The age of your vehicle affects auto insurance rates significantly. For example, older cars have depreciated value, meaning they cost less for insurance companies to replace. However, new cars could see cheap auto insurance rates too if they’re equipped with safety and anti-theft features.
Read More: How to Get an Anti-Theft Auto Insurance Discount
However, there are many other factors that affect auto insurance rates. To see exactly how the age of a car affects car insurance rates, enter your ZIP code into our free quote comparison tool above to find cheap coverage near you.
- Various factors, including vehicle age, affect car insurance rates
- Older cars are typically less expensive to insure because they’re less valuable
- Newer vehicles may qualify for a new car auto insurance discount
The Relationship Between Vehicle Age and Auto Insurance Rates
Generally, you’ll pay more for insurance if you have a new car for several reasons. The first reason that new cars cost more to insure is that they’re worth more. Your insurance company assesses worth and risk with each policy it offers, so if your car would cost $10,000 more to replace than someone else’s vehicle, your rates will likely be higher.
However, a new vehicle equipped with advanced safety features could see lower rates, since they’re less likely to get in accident or be stolen.
While people who don't have car payments can get away with a liability-only policy, most people driving new vehicles have a car loan. If you've financed your vehicle, you'll likely need to carry full coverage on your car.Travis Thompson Licensed Auto Insurance Agent
Because full coverage combines liability, collision insurance, and comprehensive coverage, a full coverage policy can cost hundreds or even thousands of dollars more per year than a simple liability policy. And if you add other coverage options to your policy, you can expect to pay even more in monthly rates.
The table below shows the different coverage options available with most car insurance companies:
Full Coverage Auto Insurance Coverage Options Explained
Coverage Name What it Covers
Liability Most states require a set amount of liability coverage that protects other drivers in the case of an accident.
Comprehensive This coverage is typically required by your lender or leaseholder.
Collision This provides financial protection for your vehicle. It will pay for damages after a crash.
Personal injury protection This coverage will pay for your own medical costs, including lost wages.
Medical payments Similar to PIP, MedPay covers injury costs but doesn't cover lost wages as PIP does.
Uninsured/Underinsured motorist protection Insurance companies are required to offer this coverage to you, and it will pay for your own damages.
Guaranteed auto protection You may owe more on your vehicle than it's worth because of how quickly cars depreciate.
Personal umbrella policy This option provides an "umbrella" of coverage over several types of insurance.
Rental reimbursement If your car is a total loss or needs repair and in need another vehicle, you should consider this option.
Emergency roadside assistance You can purchase this option from your insurer or a driving club.
Pay-As-You-Drive or Usage-based insurance If you drive very few miles, it might be cheaper for you to purchase this kind of coverage.
Non-owner car insurance This option is for people who do not own a car but borrow one occasionally.
Modified car insurance coverage Adding special coverage for those modifications will protect them.
Windshield coverage Windshield coverage will help you pay for the replacement of your broken glass (check state laws for specifics)
Mechanical breakdown insurance This coverage is similar to a manufacturer's extended warranty.
For each type of auto insurance coverage you add to your policy, your rates will increase. One of the best ways to keep rates down with a full coverage policy is to shop around online and compare quotes from multiple companies at once.
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How to Save on Auto Insurance With a New Vehicle
It can feel daunting to have a new car and know you’ll pay more in car insurance rates, but there are a few ways to save money on your new car insurance.
Many companies offer numerous discounts to auto insurance policyholders. If your car insurance company offers a new car discount, you should speak with a representative to ask whether you are eligible to receive it.
Discounts with car insurance companies can save you as much as 20% on your policy, so it’s good to ask about a new auto discount and any other discounts that might apply to you.
Another way to save on car insurance rates is to choose a higher deductible. Your car insurance deductible is the amount of money you will pay out of pocket before your insurance must help with any repairs or other costs.
If your insurance deductible is $500, you could ask an agent with your company how much your rates would change if you had a deductible of $1,000 or more. The downside of increasing your deductible is that you would pay more if you filed an insurance claim.
Other Factors That Impact Car Insurance Rates
All the best auto insurance companies determine rates a bit differently. If you shop for coverage, you will notice that your rates are slightly higher or lower with each new company you contact because different factors carry a different importance level with each car insurance company.
Most companies consider the same major factors when determining a person’s auto insurance rates. Some of the most common factors include your:
- Age
- Gender
- Location
- Credit score
- Driving history
- Vehicle type
- Vehicle age
- Occupation
- Driving frequency
Your vehicle’s make, model, and year will impact your car insurance rates with virtually any car insurance company. If you drive a newer vehicle that has a higher actual cash value, you can expect to pay more in insurance rates to account for that.
More About How Car Year Affects Auto Insurance Rates
If you drive a car that is several years old, you may be pleased with your rates. This is especially true if you do not have extensive coverage on your vehicle. But if you are driving a new car, you may find that your rates are higher than you would like.
It’s important for you to carry the coverage required for your car if you are financing it. Even if you own your new car, you may want to consider purchasing a full coverage policy to ensure it is protected if you are ever in an accident or if something happens to your car while it’s parked.
If you crash your car🚘, will your insurance cover it? With only liability coverage, you're out of luck😟. With full coverage, you're set👍. https://t.co/27f1xf1ARb has a guide to help you decide if full coverage is right for you. Check it out here👉: https://t.co/ZzJApDghSE pic.twitter.com/TKIDrrTjhC
— AutoInsurance.org (@AutoInsurance) September 25, 2023
You can always ask about auto insurance discounts, choose a higher deductible, and shop around for insurance to try and lower your monthly rates. If you have a good driving record, there’s a chance you’ll be able to find better coverage and cheaper rates with a different insurance company.
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Frequently Asked Questions
Should I consider dropping collision or comprehensive coverage for my older car?
The decision to drop collision or comprehensive coverage for your older car depends on various factors. Consider the value of your car, your financial situation, and your risk tolerance. If the cost of these coverages exceeds the potential payout in the event of a claim, it may be worth considering dropping them. However, it’s important to evaluate the potential risks and benefits before making a decision.
Are there any discounts available for insuring an older car?
Some insurance companies offer discounts specifically for insuring older cars. These discounts may be based on factors such as the age of the vehicle, its mileage, or the presence of certain safety features. It’s recommended to inquire with your insurance provider about any available discounts for your older car.
Can modifications or upgrades to an older car affect insurance rates?
Yes, modifications or upgrades to an older car can affect insurance rates. Some modifications, such as adding performance enhancements or altering the appearance, may increase the risk associated with the vehicle and lead to higher premiums. It’s important to inform your insurance provider about any modifications made to your car to ensure proper coverage.
How can I find the best insurance rates for my older car?
To find the best insurance rates for your older car, it’s advisable to shop around and compare quotes from multiple insurance companies. Different insurers have different rating systems, so it’s important to gather several quotes to ensure you’re getting the most competitive rate for your specific situation.
Are there any benefits to insuring an older car?
Yes, there are benefits to insuring an older car. As the value of the vehicle decreases over time, the cost of comprehensive and collision coverage may decrease. Additionally, if you no longer owe money on your car or its value is low, you may choose to forgo these optional coverages, which can help reduce insurance costs.
Can an older car be more expensive to insure than a newer car?
In some cases, an older car can be more expensive to insure than a newer car. This can happen if the older car has a high value or is more prone to theft or damage. Additionally, if an older car lacks certain safety features or has a higher risk of mechanical failure, insurers may charge higher premiums.
How does the age of a car impact collision and comprehensive coverage?
The age of a car can affect collision and comprehensive coverage in terms of cost and availability. As a car gets older, the cost of collision and comprehensive coverage may decrease, as the value of the vehicle decreases. Additionally, some insurers may offer limited coverage options for older cars.
Can I find cheaper quotes for a new car?
If you are driving a newer car, you should shop around to see if you can find cheaper auto insurance with a different company.
The best way to find and compare car insurance rates is by using an online quoting tool, which allows you to assess different companies and rates simultaneously. It’s important to take your time when comparing car insurance quotes to ensure you find a company that offers the coverage you want at a price that works with your budget.
How high can car insurance go?
Car insurance rates vary by vehicle type, vehicle age, driving history, location, and provider. Rates can go as high as several hundred dollars per month, particularly for high-risk drivers or those with sports cars.
What cars have the cheapest insurance?
Usually, you’ll find the cheapest car insurance from compact or midsize vehicles with safety features.
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Tim Bain
Licensed Insurance Agent
Tim Bain is a licensed insurance agent with 23 years of experience helping people protect their families and businesses with the best insurance coverage to meet their needs. His insurance expertise has been featured in several publications, including Investopedia and eFinancial. He also does digital marking and analysis for KPS/3, a communications and marking firm located in Nevada.
Licensed Insurance Agent
Editorial Guidelines: We are a free online resource for anyone interested in learning more about auto insurance. Our goal is to be an objective, third-party resource for everything auto insurance related. We update our site regularly, and all content is reviewed by auto insurance experts.