Car insurance costs add to sticker shock of buying a car right now

The more expensive the car is, the more it will cost to repair or replace
Car insurance costs add to sticker shock of buying a car right now
Posted at 5:00 AM, Jan 20, 2022
and last updated 2022-01-20 11:20:53-05

COLORADO SPRINGS — It's a tough time for buying a car right now. Deals are hard to find with inflation and low inventory because of the chip shortage. In addition to the sticker shock, it's important to factor in the rising cost of insurance.

"If we were originally rating for a vehicle that was $20,000 and now the market value is $28,000 that's going to effect rates," said Local insurance expert Trey Whitlock of the Goosehead Agency.

According to Edmunds data from the fourth quarter of 2021, the average monthly payment for new vehicles is $636. That's the highest Edmunds has on record.

The monthly payment for used cars last quarter? That came in at $520.

Add to those costs insurance costs that in most cases will be more expensive than what you previously paid.

"If you're going from something that's liability only to a full coverage vehicle, which if you have a loan you're going to have to carry full coverage, it's going to be a large jump," said Whitlock.

When exploring your options for buying that next car having your insurance agent involved could help you make a more affordable choice.

"So if you're looking at three different cars and comparing, or looking at a truck versus an SUV versus a sedan I can tell you which one is going to be cheaper than the others," said Whitlock.

According to LendingTree research these are some of the factors that will determine how expensive it will be to insure your car in 2022:

Age of the Car- Old cars tend to be cheaper to insure than new cars. One reason for this is you may not get your old car repaired if it's totaled and the actual cash value is less than the repairs.

Price of the Car- The more expensive the car is, the more it will cost to repair or replace.

Size of the Engine- If you drive a sporty vehicle that has a large engine, a v-8 or larger, your car insurance rates will be higher because of increased risk of a claim stemming from driving fast or recklessly.

Vehicle Make and Model- Insurance companies look at trends for how frequently this type of vehicle is involved in accidents and the extent of the damage.

Vehicle theft rate- Insurance companies look at the theft rate of the vehicle they are being asked to cover. A car with a high theft rate will be expensive to insure.

Another thing insurance experts say you'll want to consider is windshield coverage especially in Colorado where cracked windshields are frequent claims.

"Now, even the just regular stock vehicles from 2018 and on are going to have technology built into that windshield. So where a piece of glass that may have cost $230 or $250 before. You're now looking at $2,000 and sometimes even higher if you're having to re-calibrate those electronics," said Whitlock.

If you are not putting many miles on your vehicle these days, be prepared to take a picture of your odometer so you can communicate that in December. Less miles driven this year could save you some money.

If you're motivated to do some of the research on your own you can use the search tool provided on the LendingTree research website: