Buying a New Car and How It Impacts Your Insurance

When shopping for a new car, you may be focused on finding the right make, model and color, but it is crucial to understand how your new vehicle affects your insurance.

Your coverage needs may change when you purchase a new vehicle.

If you finance or lease a car, the lienholder typically requires full coverage auto insurance, including comprehensive and collision coverage.

They may also require guaranteed asset protection (GAP) insurance. If you don’t finance or lease the car, you can choose whether to purchase more coverage than your state’s minimum required amounts.

How to Get Auto Insurance Quotes for a New Car

When shopping for a vehicle, it can be helpful to ask your agent for an insurance quote using the vehicle identification number (VIN). Personalized auto insurance quotes can help you determine how much money to budget for appropriate coverage.

If you purchase a car from a dealership, you may need to have auto insurance coverage before you can drive the car off the lot.

Car insurance premiums depend on a variety of factors, including the make and model of your vehicle, your driving history, and your location.

Vehicle Type and Insurance Premiums

Newer cars often come equipped with advanced safety features like automatic emergency braking, lane-keeping assist and adaptive cruise control. These features can reduce the likelihood of accidents, potentially lowering your insurance premiums.

However, high-end models with complex technology might also result in higher repair costs, which could increase your rates.

The replacement cost of your vehicle plays a significant role in determining your premiums. Generally, new cars are more expensive to replace than older models. If you buy a high-end luxury car, your insurance premiums may be higher compared to a more budget-friendly option.

Insurers also consider the likelihood of theft when setting premiums. If your new car is a popular target for thieves, you might see a rise in your insurance rates.

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Contact INSANDTAGS.COM for personalized car insurance quotes.

This blog is intended for informational and educational use only. It is not exhaustive and should not be construed as legal advice. Please contact your insurance professional for further information.