Check With Your Insurance Carrier Before Buying a New Ride

My naivety quotient came down a notch today after reading the WSJ's "Eye's On The Road" Column. I thought that my perfect driving record was the reason my auto insurance premium is exceptionally low. In fact, the actuarial data compiled on the make, model and year of our 'rides' -- exclusive of actual value -- is at least as much of a determinant in establishing what we pay for auto insurance.

According to the article "insurance companies factor the claims experiences related to certain models into their rate settings". By example "In a report on insurance losses for 2005-2007 models released by the Highway Loss Data Institute earlier this month, the Subaru WRX ranks No. 1 on the Top Ten list of models with the highest losses for all types of coverage. The HLDI ranks vehicles using an index in which 100 is average [but] the WRX scored a 189 [and] … Three of the top ten [lowest scored vehicles] are minivans, including the Honda Odyssey" -- which is Jason's current ride of choice. But not all low scoring rides are boring. "Three of the vehicles that appear on the ranking of cars with the lowest overall insurance claims are sports cars: the Chevrolet Corvette, the Mazda Miata and the Pontiac Solstice, a small roadster that competes with the Miata for customers in second childhood who want a breezy two-seater but don't desire to spend the money required for a 'Vette". And perhaps most surprising, "the car with the best ranking for personal injury claims is the Porsche 911 convertible, followed by the 911 coupe" -- which Jason can now buy next.

Joseph White, the columns author, states that "a big piece is where and when these vehicles are operated ... Exotic sports cars usually aren't driven through the hurly-burly of weekday rush-hour traffic." The take-away here -- in addition to choosing a ride that fits your needs for style, economy and function -- is that you probably won't be able to intuit the insurance cost of a new car purchase. So don't forget to check with your insurance agent before driving that new or used baby off the lot -- it just might save you a bundle down the road.

William Busch

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