Car Insurance Rates: New vs. Used Cars in Ontario

Costs of car ownership start but don’t end, with the vehicle’s purchase. A great way to save money right from the start is through purchasing a used vehicle. Initial costs are lower, and a consumer may find features and options beyond what they can afford in the new car market. While second-hand cars have more wear-and-tear than new, with careful selection and attention to maintenance, this can be managed.

Insuring a Second-Hand Car

Auto insurance must be in place in all provinces and territories in Canada before a car hits the streets. In most cases, proving insurance is part of the vehicle registration process. Before you can change ownership, you must prove you have coverage in place for the vehicle.

Obviously, you can insure a vehicle before you own it. With your driver’s license information and the Vehicle Identification Number (VIN) of the vehicle, an agent, company or broker will issue a policy on the vehicle you wish to purchase, even when the vehicle is still in possession of the seller. This facilitates registration and licensing. After obtaining these, it’s a matter of changing plates and away you go.

How do I keep the cost of used car insurance low?

used car

The lower book value of your vehicle already bumps your rates down compared with a new vehicle. The style of car you choose can also help your insurance premiums.

Cars with lots of family appeal usually bring with them lower insurance costs. Four-door sedans, minivans, SUVs and crossover models appeal to family drivers. This demographic includes some of the lowest risk drivers, and in the insurance world, low risk means low premiums.

For the lowest insurance prices, avoid sports cars or coupe versions of vehicle models. A car with turbocharged or high-performance engine raises insurance rates. Anything that may invite more aggressive driving could cause rates to go up.

While those general rules hold, within a vehicle style, different brands and models have varying effects. When you’re looking for used vehicles to target, the Insurance Bureau of Canada issues a great resource, hosted on its website. Check the data on its How Cars Measure Up page. While the data may be a little confusing to absorb, it’s color-coded for simplicity. Look for models and years with lots of green boxes associated and you’ll be looking at cars with lower insurance costs.

Is the car I drive a big factor in the amount I pay for insurance?

While vehicle model does contribute to your insurance premium, it’s only one of many factors affecting the price. Your driving record and claims history have a lot more to do with the price you pay. Other factors, such as where you live and how much you drive also influence the cost of your premiums.

Using Quote Finder’s car insurance calculator as a what-if service is a great way to find out how different models and years affect the price of insurance for vehicles on your wish list. Select ‘car insurance’ at the top of the page and try it today.

2018-09-15T13:15:02+00:00