Does Having a Garage Cut my Auto Insurance Costs?

People may think that their cars would be sitting nice and cozy in the garage well protected from thieves, vandals and elements and auto insurance companies must offer them large discounts for it. This is a myth among motorists and sounds like it makes perfect sense. In reality, car insurers don’t even ask if you have a garage or not in their quote forms because it isn’t a rating factor for most companies.

However, there still may be several companies offering up to 5% discounts for having a garage but it is not a common offering and it is arguable that motorists would actually save money at the end if they choose to go with a company just because it is offering lower insurance rates for keeping the vehicle in a closed parking structure. What people need to look at is the final price, rather than chasing every little savings, especially when the savings are marginal and available through few companies.

There are several reasons why companies don’t care if applicants have a garage or not. The obvious one is that there is no statistical evidence that parking a car in the garage will reduce insurance losses. They do carry out studies and check past claims data to find out if a particular input will make a difference in terms of claims. If they found it beneficial, not only would they offer discounts for it but also they would be advertising it.

It is understandable why people may think that their vehicles will be safer locked up and they may be right about it. When they leave an automobile outside, it is an easier target for thieves and vandals. Also, they are more vulnerable to storms, hailstorms, falling tree branches and other objects. And garages keep the vehicles newer and shinier for longer.

But it doesn’t matter much when they buy Comprehensive auto insurance coverage for it because they don’t need to pay additional premium for leaving it outside. If they don’t want this coverage, they may psychologically feel better to know that their vehicle is behind locked doors.

However, car insurance companies care a lot about which zip code the automobile is kept at night as premiums can be substantially different from one zip code to the other for exactly the same settings. Statistically, automobiles spend over 90% of the time in a given zip code and especially at night. So, the risks in the neighborhood surrounding your home are real.

They look at auto theft, vandalism and weather conditions in every zip code and set rates accordingly and premiums can be hugely different from one location to the other, especially if they are in different states and if one is in a city and the other in a rural location.

One of the reasons why vehicle insurers may not bother asking about garaging is that they cannot be sure how often people use it. So, they may be under the impression that they may offer the discount but people may leave their autos outside anyway.

The second reason is that people often dent their automobiles when they are coming in and out of garages. It is less likely to suffer such losses when it is parked in the driveway.

Another interesting fact is that often when the auto insurers talk about garaging, they don’t actually mean a physical garage but they mean where the vehicle is kept most of the time overnight. In other words, where it is parked as an address but not the exact spot. This may contribute to the misconception that it is important to have a physical garage for insurance purposes.

Insurers may not ask or care for it but it is unlikely that it will hurt to have a garage next to or attached to your home. That is why you should mention to your agent or insurer that you have it. Even if you get a slight discount, it is better than nothing.