Auto insurance can be expensive depending on where you live because borrowers need to have full coverage. Additionally, you can expect to pay more for insurance with an electric vehicle (EV). If you’re considering an EV, how much more do you pay for insurance? This depends on multiple factors, but the main reasons why are more expensive repair costs and higher values.
Why EVs Cost More to Insure
Electric vehicles come with a higher sticker price, and because they’re not built exactly like gas-fueled cars, they also come with higher repair costs and require specially-trained mechanics to fix them.
According to NerdWallet’s EV study in 2015, the base prices for EVs were, on average, 70% more than their gas-powered siblings. This means if an EV is stolen or totaled, the insurance needed to cover the cost is more than a comparable gas model. Although the study was conducted in 2015, EVs remain more expensive to buy and insure.
Insurance premiums are still more expensive for EVs, and are expected to increase. As of 2017, ValuePenguin took a look at insurance rates for EVs and compared them to their gas-powered siblings. What they found was that, on average, there was a 23% difference in insurance costs – with EVs, of course, being more expensive.
How to Save Money on Car Insurance
There are a number of factors that determine your auto insurance rate that you can’t change – including where you live, your age, and your gender. But there are factors you can control, such as your credit score and vehicle choice.
Looking to save money on car insurance? Regardless of whether you’re insuring an EV or a gas-powered vehicle, there are five ways you can save yourself some cash:
- Rate shop – Just like getting an auto loan, you should rate shop for insurance premiums in order to compare the rates insurance companies can offer you. You can compare car insurance rates here.
- Raise your deductible – If you can set money aside to cover the expense, raising your deductible can lower your premium.
- Keep a clean driving record – The fewer accidents and traffic violations you have, the lower your premium is likely to be.
- Improve your credit – In most states, the better your credit score, the lower the premium. If you can, take steps toward improving your credit score before you buy and insure a vehicle. If you can’t wait, you can improve your credit score with an auto loan and each on-time payment, which may enable you to qualify for a lower insurance premium down the road.
- Consider bundling policies – It’s not uncommon for insurance companies to offer discounts by bundling your car and homeowners or renters insurance policies. You may also be able to save if you're able to insure multiple vehicles at the same residence.
Finding a Dealership to Work With
The need for auto insurance is unavoidable, but once you’ve made a decision on insurance and you’re ready to get the ball rolling on the car buying process, we can help.
At Auto Credit Express, we match people to local special finance car dealers to help them get financed if they're dealing with less than perfect credit. All you need to do is fill out our free auto loan request form, and we’ll work to get you connected to a dealership near you.