Before you buy a cheap car, take a good look at the insurance. Do it right and you can save some money on your insurance. How much you pay for your car insurance depends on the type of car and the owner but what many people don’t know is that there are quite a few cheap cars to insure which can work in their advantage.
For example, if you have a history of car accidents or you have run afoul of the traffic law before, then your track record will not be in your favour.
Insurance companies weigh in these factors when pricing the car insurance fee:
- Model – The model of your car is a factor that the insurance companies consider. The reason is that some popular models are most often stolen than other models. These include Toyota and Honda. The models with cheaper insurance are: Volkswagen Polo, Ford Fiesta, Fiats, and Renaults.
- Repair cost – The higher the repair cost, the higher the insurance fee. High end cars and vintage cars are generally more expensive because of specialised technical skill required to fix the car or that the spare parts are hard to obtain.
- History of your car – These factors play a part in the insurance fee: where you live, where you park your car and the and the mileage that you drive per year. If you live in a crime-infested area, chances of losing of your car is high. The more mileage you clock in, the more likely it is to break down due to wear and tear.
- Safety features – The safer the car, the lower the insurance fee. A car is deemed to be safe if it is equipped with safety features such as seat belts, airbags and anti-lock braking system.
- Resale value of the car – Generally, the more expensive the car, the higher the insurance fee. They also look at the value of the car if it were to be sold to someone else afterwards.
- Security features – You can lower the insurance fee by installing an alarm system to protect it against loss from theft.
- Characteristics – Insurance companies categories cars into different groups based on the characteristics of the cars . The group that pay the least insurance fee are those that are smaller and easier to drive such as four-door sedans, while high-performance cars belong to the more expensive group.
Before you buy a cheap car, consider the above eight factors which will affect the cost of your car insurance.