Whether you’re looking for your first vehicle or your fifth, there are a lot of things to consider before purchasing. You need a car that fits your lifestyle and can carry what you need. You may need a car that is pet friendly, a car that is built for off-roading, or one that is safe for children.
One of the main things to consider, even after you figure out what type of vehicle you want, is the age of the vehicle.
There are a lot of ups and downs to both new cars and old cars. Old cars may have more maintenance problems and a shorter lifespan, but new cars can be incredibly expensive and don’t always live up to expectations.
Either way, you will have to insure this vehicle. Here are some upsides and downsides to insuring both new and old cars.
Benefits of Insuring a New Car
Insuring a new car can earn you discounts from insurers. While it is usually more expensive, insurance providers are happy to insure cars with updated safety features that can help prevent accidents and, in turn, help prevent claims.
It is also easy to find insurance for a new car, as full coverage is required to protect the new vehicle.
Downsides of Insuring a New Car
As mentioned above, insuring a new car can be more expensive. This is in part because the value of the vehicle has not depreciated yet. The newer the vehicle, the more you may be paying for car insurance. Full coverage is also required by dealerships and finance institutions until the vehicle is paid off. This may mean paying for expensive full coverage car insurance for an extended period of time.
Benefits of Insuring an Older Car
An older vehicle is usually one that is 10 years or older, according to most insurance providers. As expected, insuring an older car is generally less expensive than insuring a brand-new car. This is because the value of the vehicle depreciates over time. As the value of the car goes down, so do the insurance premiums.
You may also have more leeway with the coverage on your older vehicle, especially if it is paid off. Some cars will only need basic liability insurance as required by your state, but you can often purchase full coverage car insurance, as well.
Downsides of Insuring an Older Car
Unfortunately, insuring an older car isn’t always quite that easy—or even possible. Cars that are 15, 20 years old or even older may be hard to insure. This is because very old cars are at a high risk of breaking down of having problems that can lead to a claim. Sometimes, it is because the vehicle’s value isn’t even worth insuring. If the cost of insuring a vehicle is more than the cost of completely replacing it, you could have a hard time finding insurance.
When it comes down to purchasing and insuring a car, the decision is yours. There are benefits and downfalls no matter what type or age of vehicle you buy. What matters is that you make the best decision for you and your family.
Do I Need Full Coverage Car Insurance?
Full coverage car insurance usually isn’t required by state law, but it is recommended for most vehicles, especially if those vehicles are not paid off. If you have an older vehicle, you may be able to simply insure it with liability requirements from the state. Newer vehicles will almost always need full coverage car insurance. This is because damage to a new vehicle tends to be expensive, and one accident could cost you thousands of dollars out of pocket without insurance.
Keep in mind that liability insurance only covers injuries and damage you may cause someone else while operating the insured vehicle. It won’t cover damages to your vehicle or medical payments for you and your passengers after a wreck. If you have the option to insure your older vehicle with full coverage car insurance, it may be worth the cost to avoid expensive damages and injuries later on.
Can You Drop from Full Coverage to Liability?
If you ever have a question about your insurance policy or want to change your coverage, speak to your car insurance agent. In some cases, you may be able to change your full coverage car insurance to a liability-only policy depending on the state of the vehicle, your insurer, your location and more.
Also Read: Why Did My Car Insurance Suddenly Go Up?
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