Whether you are considering buying a new or used vehicle, a great deal of thought and research precedes the final decision. This will come as no surprise as there are many costs associated with owning a vehicle. These include monthly instalments, maintenance, fuel and insurance.
One way to reduce your monthly costs is to choose a vehicle that will attract a lower premium from your insurance company. To keep track of your expenses, it’s important to remember:
1. The value of the vehicle
The biggest factor to affect your insurance premium cost is the value of the vehicle you want to insure. Simply put, the more expensive the vehicle, the more expensive the insurance premiums will be. Remember, the objective of insurance cover is to repair or replace a lost or damaged vehicle. Therefore, the easier it is to replace or repair, the lower the premiums.
Also consider that high-end vehicles are classified as higher risks because they are common targets for criminals.
2. Vehicle parts
One aspect often overlooked by vehicle owners is the availability and cost of vehicle parts. The more expensive the parts and components needed to repair the vehicle, the more expensive the insurance premium will be. A vehicle with more affordable and available parts will be less expensive to insure.
3. Imported and exotic vehicles
Think carefully before buying imported or exotic vehicles. Spare parts for these types of vehicles normally have to be imported and are therefore likely to be more expensive. These also tend to be more costly to replace and as a result, more expensive to insure.
4. High-performance vehicles
Statistically, owners of high horsepower vehicles are more likely to drive faster and at higher risk of accidents. In general, sports cars and other high-performance vehicles are also classified as higher risks because they are common targets for thieves and vandals.
5. Added extras and enhancements
Expensive add-ons will increase insurance costs too. Keep in mind that flashy sound systems or modifications are likely to make your vehicle more attractive to criminals, and this can lead to a higher insurance premium.
The colour of your vehicle may have an effect on your insurance premium. Some research has concluded that at dawn or dusk, dark colour vehicles are more likely to be involved in an accident than those lighter in colour. Dark colours can be more difficult to see in low light conditions. Insurers sometimes charge slightly higher premiums for dark colours like black and navy blue, than light colour vehicles such as white.
7. Safety features
Crime is always a threat to your vehicle and insurance companies look favourably on vehicle safety features. Theft prevention features such as an alarm or tracking device can reduce your premium.
8. High risk
Car insurers analyse vehicle and crime statistics to find out which type of vehicles are more likely to be stolen. Vehicles which tend to be stolen or involved in accidents more than the average will cost more to insure.
Useful tip: Companies such as MiWay allow you to complete multiple quotes online. This is a great way to find out how much you will pay for vehicle insurance before you buy a new vehicle.
If you are planning to buy a new vehicle, it’s a good idea to check with your insurance company first. Insurance premiums are determined by a number of factors, but with the right vehicle you can get an insurance premium that fits your pocket.
[Info by Nthabiseng Moloi, MiWay head of marketing & brand – MiWay is an Authorised Financial Services Provider (Licence no: 33970).]
[MiWay is a direct, short-term insurance company, offering customers a range of short-term insurance products including motor, household and homeowner insurance as well as add-on products such as warranty and liability cover. MiWay’s major shareholder is Santam, a blue-chip JSE-listed company.]