What impact will purchasing a hybrid car have on your insurance rate?

Most hybrid drivers make the switch from a gas-guzzler to something a little more environmentally friendly out of lifestyle considerations rather than financial ones. Hybrids, which run on both electrical power and conventional fuel, can avoid using petrol for extended periods of time thanks to an electric motor that is fueled by batteries. Owners do save money at the pump, but not always enough to make up for the Prius or Volt’s higher price tag when compared to comparable, less fuel-efficient cars [source: Helton].

Gas is becoming a more expensive part of life on the road, but it’s not the only one. Additionally, buying auto insurance can cost drivers a lot of money. Does using a hybrid vehicle also result in cost savings here?

Some well-known vehicle insurance provide hybrid drivers with rate discounts. Drivers of hybrid and alternative fuel vehicles, for instance, receive a 10 percent discount from Travelers and Farmers, while Geico offers a 5 percent discount to drivers who are environmentally conscious. Of course, these insurers aren’t lowering their prices out of a sense of noble generosity. Due to their generally lower mileage, hybrid drivers, according to research, present a lesser insurance risk than other drivers.

The hybrid reduction might be substantial, though, as annual auto insurance costs range from under $1,000 to over $3,500. If it really did apply to the entire rate, that is. Certain coverage facets, including as uninsured motorist and personal injury protection (“no fault”), which are mandated by law in many jurisdictions, are excluded from the Travelers discount for hybrid automobiles. Similar restrictions are imposed by other businesses.

One of many variables an insurer takes into account when determining an auto insurance rate is the vehicle’s powertrain. Do hybrids have any additional characteristics that might lower that rate? Find out by reading on.

Do Drivers of Hybrid Vehicles Pay Less Overall for Auto Insurance?

Auto insurance shields drivers and automobile owners from the financial risk associated with collisions, theft, and vandalism. The majority of motorists would consider it to be necessary. Auto insurance is also mandated by law in numerous states.

An insurance provider classifies individuals into groups according to the following criteria, for example:

  • Driving record: The rate is based on the number of accidents, moving violations, and significant comprehensive claims in the household of the insured;
  • Car type: The potential expense of repairing or replacing a more expensive car increases how much it costs to insure it. Air bags and anti-lock brakes are among the safety elements that insurers take into account;
  • Age: Teenagers are among the consumers with the highest risk, and they are charged as such;
  • Amount of coverage: More expensive, better coverage;
  • Consumers with bad credit typically pay 20–50% more for insurance than do those with good credit.

Conclusion: Although a hybrid driver may be able to save a modest amount on some aspects of his or her insurance premium, the rate is probably initially inflated because of other issues relating to hybrids. Particularly, hybrid cars are more expensive to repair than comparable traditional fuel vehicles, in large part because to the lack of aftermarket maintenance components for these relatively new cars. Hybrids are more expensive than their counterparts and cost more to replace. As a result, hybrid car crash claims are on average $182 more expensive than gas-powered vehicle collision claims.

According to at least one study, hybrids are also more likely to collide with pedestrians and bicycles, probably because their engines are so quiet that other drivers might not be able to hear them coming.

None of the ten cars with the cheapest insurance rates are hybrids. These ten vehicles are all trucks and vans; none of them are even automobiles.

Although driving a hybrid vehicle may be good for the environment, you won’t likely save any money on your auto insurance.

Nota d’auteur

Don’t drive if you want to save money on gas and auto insurance. Because I don’t own a car, I don’t have to pay for insurance (I live in New York City). I should add that my approach is environmentally friendly as this note is accompanying an article about hybrids. Of course, there are a lot of people for whom a life of walking, bicycling, and using public transportation will not be adequate. They should think about my second piece of advice: Do not anticipate that owning a hybrid will result in lower insurance costs. Insurance providers will offer you a variety of opulent “discounts” for driving a hybrid car, but in the end, your premium is unlikely to alter.

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