Are Newer or Older Cars Cheaper to Insure? | The General (2024)

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Are Newer or Older Cars Cheaper to Insure? | The General? ›

Since cars lose their value as they age, insuring an older car is usually more affordable than insuring an equivalent newer car. Learn how to find affordable insurance and whether you should lower your coverage on that older vehicle.

Key Takeaways: Insurance for new cars is usually more expensive because they cost more to repair and have higher values than used cars. USAA, Nationwide and Geico offer some of the lowest rates for both new and used vehicles. Most lenders require full coverage on financed vehicles whether they're new or used.

Generally speaking, the newer the car the cheaper it will be to insure. Cars aged 5 years and less are cheaper to insure than cars aged between 5 and 10 years and beyond. This is because more modern cars are often cheaper to repair, and mechanics are more likely to be able to find parts.

Classic car insurance is usually much cheaper than regular car insurance. According to Baily Insurance Agency, a classic car policy costs around $200 to $600 annually. If you own an abnormally expensive vehicle, your rates may be higher. In contrast, regular car insurance usually costs over $1000 per year.

Between 10 and 15 years after a vehicle's model year, full coverage is a poor investment. While the cost of full coverage by itself likely won't be more than what a car is worth, the cost of insurance is more likely to be higher than the value of the car after an accident.

Whether one has bought a new or used car, it is better to purchase comprehensive car insurance instead of just a third-party policy. This is because buying comprehensive insurance for an old car online provides coverage for accidental damages along with the third-party liabilities.

In general, some companies may also refuse to sell a policy, or have restrictions on providing insurance, for vehicle types with the following general characteristics: vans carrying 12 or more passengers, camper vans, cargo vans, step vans, commercial use vehicles, customized / modified construction, those of ...

Bankrate analyzed average rates for many of the most popular vehicle models on the road and found cars with the lowest insurance rates on average. These include the Subaru Outback, Honda CR-V, Honda Pilot, Ford Escape and Honda Odyssey.

The older a car gets, the harder it may be to source these parts for repair, which can also drive up the cost of car insurance for older cars. Additionally, older cars may not have as many safety features as newer cars, which might increase the cost of auto insurance and reduce available discounts.

What age is car insurance most expensive? ›

The Insurance Institute for Highway Safety reports that teen drivers are four times more likely to get into a car crash than drivers 20 and older. As a result, car insurance companies view young drivers as the most risky to insure. Drivers ages 16 to 24 tend to face the highest premiums compared to other age groups.

Age and car insurance

As a general rule of thumb, you can expect to pay the most for your car insurance when you're under 25. Once people are over 25, they tend to find that the cost of their car insurance starts to fall. The price usually declines gradually between the ages of 25 and 60.

Consider minimum coverage: Some drivers with older cars may choose not to carry comprehensive or collision coverage. If your vehicle is older and not worth much, you may not need these additional coverages. Increase your deductible: Increasing your deductible can lead to cheaper monthly payments.

Hagerty, Grundy, American Collectors, American Modern and Heaco*ck provide the best car insurance for old cars. These companies are the best options for classic car insurance because of their fair rates, accessibility and experience in the industry.

When insuring a car, a major factor that affects cost is the vehicle's value. New cars generally have higher values so insurers consider this when determining premiums. Additionally, new cars can experience fast depreciation. Depreciation starts when a new car is driven off the lot, losing as much as 20% of its value.

Additionally, maintenance costs can quickly add up as cars age. Parts are harder to find, and labor is more time-intensive. If these concerns make you uneasy, avoid cars over 20 years old. This rule of thumb may help ensure your vehicle choice is still safe, reliable, and affordable.

You most likely won't need as much coverage as you had when you were locked into a loan or lease. However, you'll still need to carry some coverage since state car insurance requirements necessitate some form of it.

Put together, Toyota, Subaru, Honda, and Nissan account for half of the cars with the best resale value.