KANSAS CITY, Mo. -- Here’s something to think about the next time you go car shopping. A brand new sedan will cost you about $130 less in insurance premiums than a three-year-old sedan.
Yes, that’s right. You will save money by buying a new car. It’s just one of the surprising findings the personal finance website, www.wallethub.com, discovered while preparing a car insurance cost analysis for the state of California.
Wallet Hub CEO Odysseas Papadimitriou said insurance is less on a new car than an older one because insurance companies know the new car doesn't have repair issues. The brakes should work on a new car, whereas with an older car, it all depends on how well it’s been maintained.
It also pays to be a nerd when you’re buying car insurance. Engineers and scientists pay among the lowest car insurance premiums. That’s because insurance claims and accident data prove they are among the safest drivers. By contrast, students, construction workers and plumbers pay among the highest rates.
If you are looking to save money on insurance, avoid buying a sports car or a truck. They are among the most expensive to insure. Data shows that people tend to drive those types of vehicles more recklessly, probably because they don’t have their kids with them. Sedans tend to have the most affordable insurance.
If you want to drive in luxury and save money, here’s a tip: Insurance premiums for expensive cars vary widely among insurance companies. Wallethub found that the premiums could as much as double from company to company, so shop around.
Comparison shopping is apparently less important if you drive a mid-market or economy car where insurance rates only had slight variations.
And reminder a single accident will cause your insurance premiums to jump 36 percent on average. Two accidents could result in your premiums more than doubling. So start thinking of your car as a giant piggy bank. The safer you drive, the more you’ll save.