How Car Insurance Companies Determine Insurance Rates

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Owning a Mercedes-Benz or BMW may be part of the American Dream, but generating the bucks to buy such a prize is difficult enough without adding in the extras of car ownership, like insurance. When you’re buying a new car, the least exciting part is almost always the insurance. Heated seats? Yes, please! Figuring out insurance premiums? No, thanks. Unfortunately for your “ugh” factor, insurance premiums play a pretty key part in determining if you can afford the car you want. While it’s not shocking that a Mercedes tops the list of most-expensive cars to insure and a Ford Edge is at the bottom of that list, knowing how different car makes affect insurance rates puts you in the driver’s seat when searching for your next new car. Bear in mind that car insurance companies take into consideration a whole host of factors when it comes to setting premiums, with the make playing a big factor in this process.
Car insurance companies focus on repair costs, how likely a car is to be stolen, and, primarily, on the make of the car when setting premiums. In the article below, we’ll cover how owning an expensive car plays a role in determining your insurance rates, the most and least stolen makes and models of car, and the deadliest and safest makes and models of cars (plus how that plays a part in setting your rates).

What Are the Most Expensive and Least Expensive Cars to Insure?

The more expensive a car, the more it costs to fix and replace its parts, which means that insurance companies end up paying more to repair a luxury car versus a standard family vehicle. Because a Maserati costs substantially more to fix compared to a Subaru, the insurance rates on the Maserati will be much higher than the Subaru. Go figure!
Learn more about the most expensive brands to insure with our list here. The top three are the Bugatti Chrion Sports 110 Ans, the Mercedes-Benz AMG GTR, and the Audi R8 5.2L V10 Quatro Performance.
Less-expensive makes and models of cars cost less to insure because repair and replacement costs run cheaper. You can find the top 10 cheapest cars to insure on our list here. The top three are the Mazda CX-3 Sport, the Honda CR-V LX, and the Jeep Wrangler Sport S.

Owning a “Most Stolen” Car

When setting insurance rates, insurers also consider how attractive your car is to thieves and it’s odds of being stolen. Every year, certain cars end up in the hands of thieves, leading to higher insurance rates for those particular makes and models. The top states for stolen cars are Washington D.C., the state of Washington, and California. The rates for insurance policies in these states reflect that data.
Some makes and models of cars are also more likely to be stolen than others. The Honda Accord, the Honda Civic, and the Ford F-Series full-size pickup top the list.

How Safety Ratings Affect Insurance Premiums

Car safety is another huge factor in the calculation of insurance rates, with cars that have lower safety ratings costing more to insure.
Business Insider put together a list of the 20 most deadly car in 2020. The Ford Fiesta, the Hyundai Accent, and the Chevrolet Sonic compact sedan were the make and model of cars with the highest death rates.
On the flip side, cars with a high safety rating can save insurers on property and personal injury costs, garnering cheaper rates. CNET.com has put together a list of the cars with the highest safety ratings in 2020. Mazda3, Mazda6, and the Mazda CX-5 topped the list.
While it doesn’t take rocket science to figure out that more expensive and less safe cars cost more to insure, knowing the ins and outs of how insurance rates are set helps get you closer to your dream car. So, before buying your next car, consider how your insurance company views the make and model of your car, whether that’s a BMW, Ford, or something in between.