Do red cars really cost more to insure?
On average, there are more than 6 million car accidents which take place every year on the roads of the country. As a result, insurance companies pay billions of dollars in claims related to these accidents. To help offset these types of losses, insurance companies will charge higher car insurance rates to drivers who are deemed riskier to insure. While the average cost of auto insurance nationwide is $1,771 per year for full coverage, drivers most likely to make a claim will typically pay more for a policy.
This means for you that having just one small at-fault accident or conviction for a traffic ticket on your driving record can result in more expensive car insurance. Plus, there are other factors, such as the type of car you drive and the area you live in, that can have a big impact on your rates. But a common belief is that the color of the car you drive can also have a big impact on the price of your auto insurance policy, with red cars notably being more expensive. But do red cars really cost more to insure than other car colors? Or is it just a common driving myth? Here’s what you need to know about the cost of car insurance for red cars.
Do red cars cost more to insure?
While many people think red cars are more expensive to insure, the truth is that the color of your car has little to no impact on how much you pay for car insurance. The color of your car only matters insofar as it reflects your personal taste and style.
This is because auto insurance rates are determined, in large part, by the degree of risk each driver considers to the insurance company. A history of at-fault accidents or traffic convictions can make a driver riskier to insure, as there is a higher likelihood of a claim being made on the person’s insurance policy. So, if a driver is deemed high risk by an insurance company, it will likely cause them to pay more for their car insurance.
What is never part of the equation, however, is the color of the vehicle. It is simply not considered by insurance companies when determining your rate. So while a history of at-fault accidents or speeding convictions may result in higher car insurance costs, driving a red car will not.
Factors Used to Determine Car Insurance Costs
Each insurance company considers different factors when determining auto insurance rates. Some of the most common factors used to determine car insurance costs include:
- Driving record: If you have a clean driving record, you may be able to get a lower car insurance premium. If you have a history of accidents, speeding tickets or traffic violations, your premiums will be higher.
- Location: Where you live can impact the cost of your auto insurance, and in some cases the difference in cost from postcode to postcode can be significant.
- Vehicle type: Certain types of cars, such as performance sports cars or high-value vehicles, are generally more expensive to insure.
- Annual mileage: How much, or how much, you drive can also be used to help determine your rate.
- Age: Young drivers generally pay higher rates for car insurance due to a lack of driving experience.
- Marital status: Married drivers generally pay lower rates for car insurance.
- Credit score (in some states): If you have a history of late payments or other credit-related issues, you might pay a higher premium in some states.
- Gender (in some states): Your gender can also play a role in the cost of car insurance in some states.
The amount and type of coverage can also play a role in the cost of a person’s car insurance. Minimum coverage auto insurance, which is the state-required minimum coverage a driver must have to drive legally, is usually the cheapest option because it offers the least amount of protection. In contrast, comprehensive insurance policies cost more on average.
Adding additional coverage to your policy can also impact the cost. Adding towing and rental car coverage and other endorsements or add-ons will add to the cost of your car insurance premium.
Your deductible can also play a role in the total cost of car insurance. Choosing a higher deductible generally means lower premiums. This is because more of the risk is borne by the insured.
Tips to lower your auto insurance premium
While there are a number of factors that determine the cost of your insurance, there are ways to lower your car insurance costs, including:
- Compare the prices: Each company sets its own rates, so the rate offered to you by one company may be significantly different from the rate offered to you by another. Shop around with local and national insurance companies and get personalized quotes to compare.
- Benefit from discounts: Discounts can be a smart way to reduce car insurance costs, and most companies offer at least some discount opportunities. Ask your company if you qualify for discounts, such as a bundle discount, a safe driver discount, or a discount for paying your annual premium in full.
- Adjust your deductible: Raising your deductible can help lower the monthly cost of your car insurance. However, it can also be a risky decision, so think carefully and assess the potential repercussions before doing so.
- Rate your policy: Add-ons, such as roadside assistance or rental car coverage, can be helpful, but these types of endorsements can also impact your premium. If you’ve added additional coverage in the past, assess whether or not it’s worth the extra costs.