Car insurance
Car insurance isn't just about following the law-it's your financial backup when things go wrong. Surprisingly, your car's make and model have a big impact on how much you pay. From engine size and safety features to repair costs, fuel type, and even theft risk, every detail counts. Popular models with good safety records and easy-to-find parts tend to be cheaper to insure. Choosing the right car not only fits your lifestyle but can also help you save on insurance premiums.
Car insurance is your safety net against accidents, theft, or sudden damage. While many things affect how much you pay for it, your car's make and model matter the most. Whether it's a compact hatchback or a luxury SUV, the kind of car you drive plays a big role in shaping your insurance premium.
Here's how a car's make and model impact the premium you pay:
The type of vehicle you drive plays a big role in determining how much you'll pay for insurance. Hatchbacks generally have a smaller price tag and are cheaper to repair, making them less risky from an insurer's perspective. That's why they often come with lower insurance premiums.
On the other hand, sedans and SUVs, especially those packed with high-end features, cost more to repair or replace. That naturally drives up insurance costs. Moreover, luxury vehicles have expensive parts, which can lead to costly and expensive replacements if they are involved in an accident. This makes insurers more cautious when pricing your policy and hence can increase your premium.
It's not just the size of the car-it's what's under the hood that matters too. Engine capacity, often measured in cubic centimetres (cc), directly affects performance. Cars with bigger engines tend to be faster and more powerful. While that might be thrilling on the road, it also means a higher risk of accidents.
One of the first things insurers assess is how safe your car is. Cars equipped with safety features like airbags, anti-lock braking systems (ABS), traction control, and rear-view cameras can fetch you a better rate. That's because these features lower the risk of accidents and injuries, making the car safer to insure.
Newer models that come with advanced driver-assist technologies, such as lane departure warnings or automatic emergency braking, can offer even more savings on premiums. If your car lacks these built-in safeguards, it may be considered a higher liability.
One of the most overlooked-but crucial-factors affecting car insurance premiums is how easy and affordable it is to repair your vehicle. Insurance providers look closely at the overall cost and convenience of repairs when calculating your premium. The logic is simple: the more accessible and affordable the repair process, the lower the risk for the insurer.
If you drive a popular car model, chances are spare parts are readily available and don't cost a fortune. This makes repairs quicker and cheaper, which insurers consider a plus. Lower repair costs mean the insurer won't have to spend too much if you make a claim-so they reward you with a lower premium.
On the flip side, rare, luxury, or discontinued models often require specialised servicing or imported components. These cars can be expensive and time-consuming to repair. Whether it's sourcing a unique part or paying for expert labour, the costs add up quickly. Insurers factor in this added risk and typically raise your premium to cover potential claims.
You may not have thought about it, but the kind of fuel your car uses can affect your insurance costs. Diesel vehicles, although efficient, often come with higher market values and increased maintenance needs, which can result in higher premiums.
Similarly, if your car runs on CNG, insurers might consider it a bit riskier due to the added mechanical complexity. On the flip side, many electric vehicles (EVs) come with government- backed incentives and are considered safer in some cases, potentially reducing insurance costs.
Car insurance premiums and your car's age have an interesting relationship. When a car is brand new, it has a higher Insured Declared Value (IDV), which means you'll pay a higher premium. But as the vehicle gets older and its value depreciates, your premium tends to go down as well.
Not all versions of a car are treated equally. A base model of a vehicle may have a different premium than its top-tier trim loaded with extras like a sunroof, touchscreen infotainment, leather seats, and a high-end sound system. More expensive trims increase the car's overall value-and the cost to repair or replace them-which insurers take into account.
And if you've made modifications after purchase, like fancy rims or a body kit, your insurer will probably charge you more. These changes can affect the car's performance and value, thereby increasing the risk and the premium.
No one wants their car stolen but some makes and models are more popular with thieves than others. If you happen to drive one of these models, insurance companies might charge a higher premium to cover the increased risk.
That's where security features come into play again. Cars fitted with anti-theft alarms, GPS trackers, immobilisers, and steering locks are less likely to be stolen. Having these features not only brings peace of mind but can also help lower your insurance costs.
Understanding how your car's make and model influence insurance premiums empowers you to make informed decisions, ensuring optimal coverage at a reasonable cost. A car insurance calculator is a valuable tool that allows you to estimate your insurance premium based on various factors, including your car's make and model.
Disclaimer: The above information is for illustrative purpose only. For more details, please refer to policy wordings and prospectus before concluding the sales.
