Can A Fast Car Raise Your Insurance Rate

Posted in: Car Insurance, Driving Tips, Fleet Driver News, News.

Can A Fast Car Raise Your Insurance Rate
Can A Fast Car Raise Your Insurance Rate

Looking back merely 10 years ago, the fact is that the speed of even the best of cars cannot match the one that a lot of models have today. Back then, V-8 engines were known for their horsepower of 300, and that was the best you could get. However, vehicles have really advanced since then, due to a variety of factors, such as turbocharging, direct fuel injection, and so on.

First of all, speed is seen as how fast a car can accelerate and how powerful its engine is. Top speed is something that matters only for racing cars. Well, the former is now something that people can actually achieve in the form of a modern car, such as the Tesla Model S, which is considered the third fastest car around the globe.

Now, what is really important for car owners to think about when they decide to get themselves a new vehicle is how much it is going to cost them in total. Because the fact is that it’s not just the selling price that they need to think about. The type of car that you choose to drive has a significant effect on how much your insurance is going to cost on a monthly basis.

Does a faster car raise the insurance rate, and why?

The main question that you need to ask yourself is – how do insurance companies regulate how much your premium is going to cost? In essence, there is a variety of factors which are used to determine how much of a risk you are as a driver. When you drive a car that packs a lot of horsepower, it means that you present a greater risk in the eyes of your insurance company. That is why when you purchase a fast car, you are certainly going to pay more to insure it.

In truth, it doesn’t really matter much that you have a really fast car that will enable you to speed down highways. An insurance company actually finds it important how much it is going to cost to repair your car or get a new one. When we look at modern cars, the fact is that the engineering that they use in order to achieve such a great performance is quite complex. What does this mean? Well, the answer is pretty simple – they are a lot harder and more expensive to repair. If you further take into account that driving your high-performance car at an extreme speed means that there is a greater probability that you are going to have an accident, as opposed to driving just a regular car. So, you can understand how insurance companies see this.

However, regardless of insurance, the fact whether someone is a higher risk for causing a traffic accident actually depends a lot more on the driver themselves.

What happens when you speed?

Can A Fast Car Raise Your Insurance Rate2
Can A Fast Car Raise Your Insurance Rate2

Another fact that you really need to keep in mind if you own a high-performance car is that you must always adhere to the rules of the road. This sounds like common sense, because you are certainly going to do your best to maintain your safety as well as that of other drivers. The reason that we are mentioning this here, however, is the fact that the penalties that you might happen to get for speeding can have a significant impact on your insurance rate.

For example, back in 2016, if you ended up being convicted of speeding in the US, these are the percentages by which your insurance rates would increase:

  • Convicted of speeding in a School Zone – 18 percent
  • Convicted of speeding from 6 to 10 MPH above the limit – 17 percent
  • Convicted of speeding from 11 to 15 MPH above the limit – 18 percent
  • Convicted of speeding from 16 to 20 MPH above the limit – 19 percent
  • Convicted of speeding from 21 to 25 MPH above the limit – 20 percent
  • Convicted of speeding in a 65 MPH zone – 23 percent

What you can deduce from this is that if an average insurance fee is $1,323, getting just one speeding ticket could boost the rate from $225 to #304. Furthermore, this means that the points you get will remain on your driving record for about three years, depending on where you live.

Insurance companies and car repair

Every insurance company has its own way of dealing with business operations. There is a variety of factors that influence this. For example, there are matters such as whether the company is public or private, how much employees does it have and what their salary is, and, most importantly, how much has been paid in claims.

So, every insurance company has its own payment plans to offer. The total cost is, of course, affected by which payment plan you pick. Depending on a particular period and situation, you should always make sure that you check for savings and change the payment plan accordingly.

Furthermore, there is a difference in how long you are insured. A lot of businesses will gladly provide you with lower rates if you have been with them for an extended period. It’s not really a big discount, but it matters when you look at the larger picture.

Also, even with the fact that your insurance rate is bound to rise when you purchase a high-performance car, you still need to find a car repair expert, such as smash repairs Epping, that will make sure that you don’t spend way too much money on fixing a car that is generally more difficult to maintain than a regular vehicle.

So, the answer to the question whether a fast car can raise your insurance rate is a simple yes. It is all because insurance companies look at the fact that your car is more expensive to repair, and you are generally a higher risk as a driver. However, you can maintain a steady insurance fee by strongly adhering to the rules of the road, and also find a car repair expert that will charge you less than others.



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