Why am I paying $200 a month for a car that is worth $2500?

"If the actual cash value of my car is only $2500, why is my insurance so high? I pay $200 a month and have only had a couple of speeding tickets, no accidents."

Answer
“The cost of insurance isn’t impacted by the value of your car as much as you would expect. The vehicle’s value mainly affects the price of comprehensive coverage and collision coverage. If your car only has a value of $2500, you will want to think about removing full coverage to save some money.
Liability coverages is another significant part of your policy. If you have a few speeding tickets, your policy might be surcharged. About three years after your last ticket, the surcharges will fall off and your rate will go down.
The price of liability is based on many factors like past driving history and the cost of medical expenses where you live. The value of the car only plays a factor in regards to safety features. Newer cars tend to have better safety features and the result is a lower price.”
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Shannon Martin
Answered on Jul 28, 2021
Shannon is an expert in personal lines liability insurance with 13 + years of insurance industry experience. She also served as a special insurance liaison to AARP members for 6 of those years. She is a graduate of UL Lafayette and currently resides in NY with her family. Shannon is also an amateur juggler, ukulele player, and is a time travel paradox theory enthusiast.
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