How to Find the Best Used Car Insurance for Your Pre-Owned Vehicle

By the Mercury Team

If you’re a recent used car owner or considering buying a pre-owned vehicle, you’re probably thinking about protecting your investment with the right insurance. Shopping for auto insurance can feel overwhelming, especially with so many options available. However, the process becomes much simpler when you know what to look for and consider the factors that determine your insurance premium. In this post, we’ll go through the ins and outs of used car insurance so you can secure a policy that offers peace of mind and value.

Why Is Insuring Your Used Car Important?

Whether you have a new or used vehicle, auto insurance is important because nearly every state, except for New Hampshire, requires drivers to carry proof of insurance. Even in New Hampshire, driving without insurance can put you at serious financial risk. If you’re involved in an accident, you could be held liable for damages, medical bills, and legal fees — costs that can quickly add up and leave you in a financial hole. The right insurance coverage can help you alleviate potential burdens and protect you, your passengers, and your vehicle.

How Is Used Car Insurance Different Than New Car Insurance?

There aren’t specific policies for new or used cars. In other words, insurers offer the same coverage options regardless of whether your vehicle is brand new or pre-owned. However, the cost of insuring a used car can vary compared to insuring a new one. Plus, your coverage needs may change based on your vehicle’s age and condition. For example, with an older car, you might choose different levels of coverage or add extra protection, like mechanical protection, to cover the unique risks that come with a used vehicle.

What Is the Cost of Insurance for Used Cars?

Generally, insuring a used car is less expensive than insuring a brand-new vehicle. This is because used cars typically have a lower value than new cars, so the potential payout in case of a total loss is smaller. However, there are still plenty of variables that can affect your premiums.

Factors Influencing the Cost of Used Cars

Insurers often look at the following factors to help determine your insurance rate:

• Car’s age and value: As mentioned previously, older cars with lower market values are typically cheaper to insure. But if you have a classic car or one with rare parts, your insurance might be more expensive.
• Vehicle type: The type of car you drive also affects your insurance rate. For example, luxury vehicles and sports cars usually have higher insurance costs because they’re more expensive to repair or replace.
• Your driving history: If you have a clean record with no accidents or violations, you could be eligible for discounts. On the flip side, a history of accidents or traffic tickets could result in higher premiums.
• Location: Where you live can also impact your insurance costs. Urban areas often have higher rates of accidents and theft, which can lead to increased insurance premiums. Conversely, if you live in a rural area with less traffic and lower crime rates, your insurance may be more affordable.
• Coverage options: The types of coverage you choose will directly affect your insurance costs. Basic liability coverage might keep your premiums low, but adding options like comprehensive, collision, or roadside assistance will increase the cost.
• Personal factors: Your age, gender, and even your credit score (except in states where it’s not allowed) can influence your premium. For example, it’s generally more expensive to insure teen drivers because they carry more risk than other motorists.

What Kind of Insurance Do You Need for a Used Car?

Before you decide on a policy, assess what kind of coverage you actually need.

Assessing Your Coverage Needs

Here’s a breakdown of the main types of car insurance:

• Liability protection: This is the most basic type of coverage required by law in most states. It covers damages to other people’s property and any injuries they might suffer if you’re at fault in an accident.
• Comprehensive coverage: This protects your car against non-collision incidents like theft, vandalism, or natural disasters.
• Collision coverage: This covers damages to your car in case of an accident, regardless of who’s at fault.
• Uninsured/underinsured motorist coverage: This type of insurance protects you if you’re in an accident with someone who doesn’t have enough insurance to cover the damages.

So, do you need full coverage on a used car? It depends on a few factors. If your car is older and has depreciated significantly, you might opt for just liability insurance, especially if paying for repairs or a replacement wouldn’t be a financial strain. However, if your used car still holds value or you can’t easily cover repair or replacement costs, full coverage — including comprehensive and collision — might be the safer bet.

If you need help figuring out what’s best for your situation, contact a local Mercury agent and they can tailor a policy that suits your needs.

How to Find the Best Insurance for Used Cars

Once you assess your insurance needs, it’s time to find the right policy for your used car. Here are some steps you should take:

• Compare quotes: Shop around and compare offers from different insurance companies, and look for a balance between coverage options and cost.
• Check for discounts: Many companies offer auto insurance discounts that can help lower your premium. Look for discounts related to safe driving, bundling your auto policy with other types of insurance, or even paying your premium in full.
• Consider the insurer’s reputation: Price is important, but so is the quality of service. Research the reputation of the insurance companies you’re considering by checking reviews on customer service, claims handling, and overall satisfaction.
• Read the fine print: Make sure you understand what is and isn’t covered, as well as any deductibles or limits. This will help you avoid surprises later on and ensure you get the protection you expect.

Conclusion

Finding the right insurance for your used car involves striking a balance between coverage and cost while understanding your specific needs. Although it’s usually more affordable to insure a used vehicle than a new one, factors like your car’s age, condition, and driving history can still influence your premium.

If you’re looking for cheap auto insurance that still provides quality protection, consider reaching out to Mercury. We can help customize a policy that fits your budget and your vehicle’s needs so you can have peace of mind whenever you’re behind the wheel.

Contact us today for a fast, free quote!