Does Car Insurance Cost More or Less for Small Cars?

Is car insurance more expensive or less expensive for smaller car as compared to larger cars? This would seem to be an easy question to answer; the bigger the car, the more expensive it is. Therefore it must cost more to insure larger cars than smaller ones, right?! Not so, based on study published on MarketWatch ( that was conducted by last fall.

Surprisingly, it turns out many small cars carry higher car insurance rates than cars, trucks, and SUVs costing thousands more. The study analyzed the 20 most popular cars sold in the US and then crunched their car insurance rates across all 50 states. The rates were then averaged and the 5 most expensive vehicles based on their average annual premium are:

  • Nissan Altima at $1,414 a year
  • Toyota Prius at $1,404 a year
  • Toyota Corolla at $1,400 a year
  • Ford Focus at $1,391 a year
  • Hyundai Elantra at $1,384 a year

The reasons given for these cars having such high average car insurance rates vary. The Altima is one of the most stolen vehicles in the country. The Prius has higher average claim cost when involved in an accident due to the expensive electronic components in it. The Corolla, Focus, and Elantra, like many popular smaller cars tend to sustain more damage in a wreck because of their size. More damage means higher claim costs.

Given the study’s findings, what’s a car buyer to do? Here are 4 suggestions that should help stretch your dollars!

Compare Insurance: Most of my clients call me after they’ve bought a new car and then hope the insurance cost doesn’t cost too much. I believe car shoppers should compare car insurance for different models before buying their next car. If you’ve narrowed down the car model and equipment level you want, call your agent and see what it cost to insure it compared to your current vehicle. If you’re looking at a couple of different vehicle models compare the cost of insurance for all of them. Insurance cost should be a factor in the overall cost of ownership of any vehicle.

Compare Models: Let’s say you are looking at the Toyota Prius. Compare its insurance cost to the Honda Insight or another hybrid. Compare the insurance cost of the Ford Focus to a Chevy Cruze or a Kia Forte and the Nissan Altima to the Subaru Integra of Ford Fusion. There are different rates on every model so pick models from different auto makers in the category you’re looking at and see how their insurance rates vary.

Compare Categories: Be willing to look at different types of vehicles. For instance, look at a Crossover or SUV if you’re thinking about a sedan. Insurance rates for a Subaru Crosstrek or Honda HR-V may be less than the Corolla or Elantra and provide you with similar fuel economy and room.

Discounts: Once you’ve decided on which vehicle to get, ask your agent about discounts. Cars with 4 wheel anti-lock brakes, daytime running lights, and a passive security system cost less to insure than cars without these three items. I also expect that we’ll see savings introduced either this year or next on models with safety systems such as brake assist, blind spot and lane departure warning.

What do you think? Share your car insurance questions, comments, and experiences with me on my Google +, Facebook, and LinkedIn pages. I’d love to hear from you!

Evie Wise
Evie Wise


Evie Wise
Evie Wise

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