Luxury vehicles are expensive to buy, usually have powerful engines for enhanced performance, they are costlier to repair because of their expensive and intricate parts and all these characteristics makes luxury cars expensive to insure in comparison to commonly available and easy to repair vehicles like popular sedans and minivans. While some high-end automobiles may attract considerably higher premiums, a few of them may not cost as much to insure, especially if they are rated highly in crash tests, come with a more modest price tag and are more commonly available for parts and repairs. The more exotic your vehicle is the higher your car insurance is likely to be.
Nevertheless, you can find coverage from nearly all insurers for your relatively common high-end automobile and generally you need to go through the same process of assessment and premium calculations. But some of the factors may be more prevalent in determining premiums like age due to high-performance engines.
Variation in this vehicle category is very wide. Even though they are considered high-end, many automobiles may be commonly available on our streets and therefore they may have widespread parts and repair shops for them. Then, most vehicle insurers would offer competitive rates for such vehicles to make sure they can capture their share of the business in this market segment. For example, several models of Mercedes-Benz, BMV, Audi and even Porsche cars are normally categorized luxury but they are fairly common and most automobile insurers are very familiar with them.
On the other hand, the more unique, custom-built and high-performance they get the higher their car insurance premium would get. Especially when you get into Lamborghini, Ferrari, Maserati, Aston Martin and custom-built cars, you may need to be prepared to pay twice or even three times higher vehicle insurance premiums. One of the main issues for these automobiles is that they are often built lighter to increase the performance and therefore they may suffer more damages in accidents. In addition, the fact that they can take off real fast and can reach very high speeds in no time doesn’t help either.
Particulars of the insured vehicle can significantly affect your premiums. Due to their price tags and speed capabilities, luxury automobiles are typically considered higher risk for insurance in comparison to a modestly priced sedan, which is generally easy to handle even by novice drivers. That is why owning a high-end car influences your premiums more because they attract higher rates. It is the same idea as having a higher multiplier in an equation.
Think about it this way: let’s say that a modest sedan has a multiplier of 1 and therefore doesn’t really increase your vehicle insurance rates. On the other hand, a high-end car with a more powerful engine like a BMW X3 would have a multiplier of 1.5, meaning you have to pay 1.5 times more for auto insurance if you own a BMV X3 in comparison to a typical sedan. If you own a rare Ferrari, your multiplier could easily shoot up to 3, translating to having to pay three times higher premiums. Hopefully, the influence of the vehicle details on your premiums is clearer now.
In other words, if you are generally considered a low-risk motorist who is at least over the age of 25, have a good credit score, clean driving record, long insurance history and live in a favorable zip code, you may be able to find relatively affordable car insurance quotes through most insurers you apply to, even with a luxury car. Because you are more reliable thanks to your proven record, most insurers are more comfortable with providing auto insurance coverage.
Contrarily, if you were a high-risk driver due to your young age, recent at-fault accident or several traffic violation tickets, you would struggle to find affordable vehicle insurance as it is, regardless of your automobile. If you add a luxury car, which is considered high-risk too, you would be multiplying your troubles and you may now really struggle to find companies willing to insure you with that particular car and the ones that do would want to charge you very high premiums.
In short, your car’s characteristics like its make, model, value, engine size, performance, repair costs and safety ratings and features are considered in insurance premium calculations and luxury automobiles tend to end up in the high-risk category, resulting in higher premium costs. Furthermore, high-end vehicle classification encompasses a wide variety of automobiles. While you may be able to insure some of them at reasonable costs, the more expensive, high-performance and exotic your car gets the higher you may have to pay for your insurance.