I’m paying $730 per month for car insurance, which feels excessive. I’m 22, turning 23 in November, and I’ve been driving a 2003 Honda Accord for the past three years. Thanks to a work discount, I’m currently paying $235 per month.
Now I’m considering upgrading to a 2020 Honda Accord, priced around 25k CAD. However, the lowest quote I received is a staggering $730. I have a clean driving record, never missed a payment, and I’ve been on the road for three years. Plus, this newer car is safer than my current one.
Can anyone explain why my insurance rates are so high? It’s a touring model with four doors—there’s nothing sporty about it!
What factors contribute to these high premiums, especially at my age?
There are several factors that could contribute to the high insurance quote for the 2020 Honda Accord, even if you have a good driving record and experience. Here are some reasons to consider:
Age and Experience: Being 22 years old means you are still considered a high-risk driver by insurance companies. Younger drivers typically face higher premiums because they have less driving experience.
Vehicle Type: While the Honda Accord is generally seen as a safe and reliable vehicle, certain features or specifications of the 2020 touring model could impact insurance costs. For example, if it has advanced safety features, it might be more expensive to repair or replace in case of an accident, which could lead to higher premiums.
Coverage Levels: If the quote includes comprehensive or collision coverage, those options can significantly increase the monthly payment. Review the coverage limits and deductibles included in the quote to see if adjusting them could help lower the cost.
Location: Your geographic location also plays a crucial role in insurance rates. If you live in an area with high theft or accident rates, this could lead to higher premiums.
Insurance Provider’s Policies: Different insurance companies have different underwriting criteria and algorithms for determining rates. It might be worth shopping around for quotes from multiple insurers, as some might offer better rates based on your profile.
Market Rates and Inflation: Car insurance rates have been rising in many areas due to overall market trends and increased repair costs, especially with the rising costs of parts and labor.
Annual Mileage: If you plan on driving a lot more than you did with your 2003 Accord, that could also raise your premium. More miles can lead to a higher chance of an accident.
Credit Score: In many places, insurers use credit scores to help determine premiums. If your credit score isn’t as strong, it could result in higher insurance costs.
If you haven’t already, it might be a good idea to revisit a few insurers for quotes, ask about discounts you may qualify for, and consider adjusting your coverage to find a balance that works for your budget.