$730/month for car insurance?!
I’m 22 (turning 23 in November) and have been driving a 2003 Honda Accord for the past three years. Thanks to a work benefit discount, I’m currently paying $235/month.
Now, I’m considering upgrading to a 2020 Honda Accord, priced around 25k CAD, but I’ve received a quote of $730/month—way higher than expected! I have no accidents on my record, have never missed a payment, and I’ve been driving for three years. Plus, the new model is safer and more reliable!
Why is my insurance quote so high? It’s a touring model with four doors, and “sport” isn’t even in its name.
What factors could be contributing to this steep rate, other than my age?
There’s a few factors that could contribute to the high insurance quote you received for the 2020 Honda Accord, even though you have a good driving record and experience. Here are some potential reasons:
Age and Experience: Being 22, you fall into a younger age bracket, which statistically tends to have higher accident rates. Insurers often charge higher premiums for younger drivers, regardless of their driving history.
Value of the Car: The 2020 Honda Accord is worth significantly more than your current 2003 model. Insurance rates generally increase with the value of the vehicle due to the potential cost of repairs or total loss in case of an accident.
Vehicle Classification: Even though the Touring model may not seem overly sporty, it’s still classified as a higher trim level, which can affect insurance rates. Higher trim models often come with more expensive parts and features that could drive up repair costs.
Safety Ratings: Newer cars often come with more safety features, which might lower premiums. However, if the model has a reputation for high repair costs or if it’s a popular target for theft, it could raise your insurance.
Credit History: Insurers often consider your credit score as part of the underwriting process. If you have a limited credit history or any red flags, that could impact your rate.
Location: Your overall environment and local statistics can also play a role. If you live in an area with higher rates of accidents or theft, your insurance premium may be higher.
Coverage Levels: Be sure to check what coverage limits you’ve quoted for the 2020 Honda Accord. If you’re looking at comprehensive or collision coverage with lower deductibles, that will significantly increase your premium.
It might be worth shopping around with different insurance providers or reviewing your coverage options to see if you can find a better rate or if there’s anything you can adjust to help lower your premiums.