How Have Oil Prices Affected The Cheap Car Insurance Industry?
The cost of fuel is on the rise and has had an impact on the cost of everything else; including the rates you pay for cheap car insurance. car insurance rates dipped and then rose again with rising gas prices. The effect which fuel prices have had on the industry may surprise you.
One effect is that a lot of people have decided to ditch their SUVs and other large vehicles in favor of smaller cars which are more fuel efficient. This can make your insurance rates increase – why? It’s because that statistically, the drivers of smaller vehicles tend to be younger and less experienced; small cars are also not as safe in a collision.
What does this mean for consumers? You need to compare your fuel savings with a increase in cheap car insurance rates to determine if you are actually saving money by switching to a small car or losing out.
One insurance industry professional has noted: “People are more expensive to fix than cars”. What he’s getting at is that larger cars are safer in accidents and that there is damage to drivers and passengers to be considered as well as to the vehicles involved. Driving a larger vehicle means lower rates of injury in an accident and thus lower insurance rates.
This is what it all comes down to in terms of cheap car insurance rates and fuel costs. Even supposing that the cost of gas were to drop, the car insurance industry isn’t likely going to lower their premiums. You need to think about all of your options and weigh them carefully to make your decision as to whether you will really be better off trading in that gas guzzling SUV for a compact car.
If you opt for a smaller car, you should think about going for a mid size rather than a compact and look for one which has a good safety rating to keep your premiums lower. Some smaller vehicles are rated well for safety – for instance, the Mini Cooper and the Volkswagen Beetle and Golf. While these cars may not actually be safer in a collision, they tend to be driven by older, safer drivers and have a low accident rat due to this factor.
If your car is larger than you’d like to be driving, be sure to evaluate the costs and benefits of the situation so that you’ll know for sure if you’ll really save money with a smaller car. And since a smaller car is not as safe either, you might want to think about keeping that gas guzzler after all.
Technorati Tags: No Tags
Related Tags: No Tags
Possible Related Posts
No related posts