If you are planning on purchasing a brand new or a new (to you) vehicle this summer, it is important to realize how this new vehicle will impact your overall insurance premium. Here are three things you should know before you purchase a new vehicle.
#1 The Color Doesn't Matter
Many individuals falsely believe that insurance companies in part base your premium on the color of your vehicle. For example, red and yellow cars are charged a higher premium because of their bright colors and increased chance of getting a ticket or into an accident and black and grey cars are charged less because they don't stand out as much.
This is not true. This is an urban myth that has been around for a while. Your insurance company does collect information about the color of your car for identification purposes, but it is not a factor that affects the rate of your insurance premium. So if you love that bright red car, don't hold back for fear that your insurance will be higher than if you went with a tamer colored car.
#2 The Type Of Vehicle Matters
Although the color of your vehicle doesn't affect your insurance premium, the type of vehicle that you purchase does affect what you pay for auto insurance.
If you choose a vehicle that is considered low-risk because of the safety and theft data on the vehicle, as well as the lower cost of the vehicle in general, you will most likely pay less for insurance. If you purchase a vehicle that is low-profile, which basically means that it is not that likely to be stolen, this will help keep your auto insurance rates in check as well.
If you purchase a vehicle that is expensive, your premium is going to be higher. If you purchase a vehicle that has been shown to be target of thefts, your premium is most likely going to be higher. If you purchase a vehicle that does not have a lot of standard safety features, expect your insurance to increase.
#3 If You Take Out A Loan Matters
Finally, if you take out a loan, your insurance premiums could also increase. When you take out a loan, you are generally required to carry full coverage. If you had previously not been carrying full coverage on your vehicles, this could greatly increase your overall insurance premium if you were carrying the minimum coverage necessary. Loan companies require you to carry full coverage so if something happens to your vehicle, you will still be able to pay them back.
For more information, contact a company like Affordable Insurance.