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Saving on Gas Might Mean Paying More for Insurance

Saving on Gas Might Mean Paying More for Insurance

Saving on Gas can be Expensive

What have you been doing to save on gas lately? From simply driving less to going without air conditioning, everyone’s looking to pay a little less at the pump these days. That’s why we’re seeing more and more people trading in their gas guzzling SUVs and trucks for something a little more fuel efficient. For drivers with a long commute to work each day, the extra space or security of a larger vehicle just may not seem worth it after paying upwards of $300 a month on gas. Whether it’s an electric, hybrid, or just more fuel efficient gasoline car, many people are seeing big savings after making the switch. However, could those savings be but fleeting reprieve? Before you ditch your diesel for compact, you might want to consider the insurance implications first.

Why are Premiums Higher for Smaller Cars?

More than a few people have experienced buyer’s remorse this year after trading in their truck or SUV for a smaller vehicle. Believing the switch would save them big money usually spent on gasoline, they aren’t prepared for the sudden jump in insurance costs. Premiums for smaller cars are almost always higher than those of larger vehicles because they often endure greater damage in an accident. The occupants of smaller vehicles tend to suffer more injuries and have a higher fatality rate than those in large vehicles as well. While the difference in premiums between a large and small vehicle may not seem significant, it can offset the gas savings of swapping cars just for fuel efficiency. Here’s a look at some ways that you can still get a low rate on a policy, even if you’ve switched to a smaller vehicle.

Getting Low Rates for Smaller Vehicles

  • While the type of vehicle you drive is an important factor in determining insurance rates, your credit score may be even more significant. So if possible, do whatever it takes to increase your credit score before exchanging a truck or SUV for a smaller vehicle.
  • Another reason why smaller vehicles are more expensive to insure than larger ones is that they are stolen at a higher rate. Help alleviate the chances of your smaller vehicle being stolen by installing security devices like an alarm or LoJack system.
  • Do you have a couple bad marks on your driving record? You may be able to eliminate them or at least marginalize them by taking a driving course. There’s usually a fee for taking the classes, but you could easily save more money over time if they get you a lower premium.
  • In order to promote environmental protection, some providers give 5%-10% discounts for drivers of electric or hybrid cars. That discount may provide a good middle ground for saving on gas without paying more for insurance.
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