How Much You Pay for Insurance Can Depend on the Type of Vehicle

A sneak peak at one of the questions that might appear on your next quiz in Auto Insurance 101 -- Will the type of car you drive help determine how much you pay for auto insurance? Go to the head of the class if your answer was "yes."

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The vehicle you drive absolutely is part of the equation on auto insurance cost, acknowledges American Insurance Association executive Dave Snyder. "The make and model of your car is an insurance factor, and how the make and model performs in terms of crash and theft costs will alter the premium over time," says Snyder, AIA vice president and assistant general counsel in Washington, D.C.

Snyder says that "when a car model first comes out, it's given a symbol by insurance rating organizations that predict its expected costs to insure compared to other vehicle makes and models. As experience accumulates for that make and model, the car may be moved up or down in the ratings and that would affect the cost you pay for comp and collision coverage," In addition to your type of car, auto insurers factor in your driving record, claims history, credit history, age, gender, amount and type of auto insurance purchased, where you live, just to name a few key pricing variables.

Sports cars and sport utility vehicles (SUVs) are among the type of vehicles that probably will cost you more in liability premiums. Some auto insurers rate SUVs differently based on the vehicles' histories of causing more damage to other vehicles when involved in collisions.

Russ Rader of the Insurance Institute for Highway Safety says crash experience and loss experience for the make and model of your vehicle help determine your insurance premium. "When you're buying a vehicle, you should check crash test rating but also you should select a vehicle that has low insurance losses in real crashes because that can help lower your insurance premium, and the Highway Loss Data Institute (HLDI) publishes a brochure that shows such losses for vehicles by make and model (http://www.hldi.org/)."

In terms of passenger safety, Rader's organization recommends that you buy mid-sized or larger cars with good-crash test ratings. "What matters most is survival if you get into a crash. Size and weight of a vehicle are important, and you get that with a larger car. SUVs have the advantage of size and weight in crashes with other vehicles, but they are more likely to be involved in single vehicle rollover crashes. Safety features such as side air bags can help save your life or that of a loved one in a serious side impact crash.

And having electronic stability control can help prevent a crash from happening in the first place." Rader described the electronic stability control as a new safety tool found in many 2006 foreign and domestic models. A computerized system that`s part of a car's anti-lock braking system, it operates like an automatic pilot. It helps you keep the car under control on slippery curves or in emergency maneuvers such as a sudden swerve.

HLDI executive Kim Hazelbaker focused on average loss payments per insured vehicle year from HLDI's most recent Property Damage Liability report (2003-05 models). That report covers an insured's vehicle for damage it causes to another vehicle. The numbers were $79 for passenger cars; $81 for small SUVs; and $92 for large SUVs. The aforementioned totals of $79, $81 and $92 refer to the actual portion of an insured's premiums related to damage their cars caused in accident with another vehicle, explains Hazelbaker, HLDI senior vice president, in Arlington, Va.