Whether it’s concern for the climate or gas prices, there are plenty of reasons to opt for an eco-friendly car. Keep in mind, however, that while you work to save the earth, you might not be saving cash. Your insurance premiums will likely be a bit more expensive for alternative-energy vehicles. Cost isn’t the only factor to consider, but shouldn’t be overlooked if you’re pinching pennies and considering a going green to create more space in your budget.
Why does environmentally-friendly auto insurance cost more?
The cost of your auto insurance depends, in part, on the cost of your vehicle. If your car costs more, so do the parts that must be replaced or repaired if damaged. Comprehensive and collision coverage premiums in particular may be priced higher for your hybrid or electric vehicle because the parts are less common and are typically more expensive to replace. As cars with alternative fuel sources become more common, this will become less of an issue.
So – do you pay more in the long run?
It’s hard to say, and as with most insurance questions, the answer to this depends on your personal circumstances. Generally speaking, choosing a hybrid or electric probably isn’t the best way to go if your motives are purely economic. In most cases, you’ll save more in the long run with a pre-owned gas-engine vehicle. But don’t fret – there are other ways to decrease the toxins (and cash) you’re putting out on your commute. Consider carpooling, moving closer to work, or trading in your gas-guzzler for a used vehicle with better mileage.
If social responsibility is what’s fueling your decision, don’t let your auto premiums discourage you. An independent agent can compare rates from various companies to see where you can get the best deal. Some insurance companies also offer discounts to incentivize drivers to go green, so ask your agent about those options as well. Allstate, Farmers, 21st Century, The Hartford Group, Liberty Mutual, and Travelers are a few companies who have offered some type of incentive to decrease your carbon footprint. As more businesses trend toward social responsibility, these discounts may become more widely available.
If you’re still crunching numbers and unsure of where to turn next, give us a call. Our Guides are well-versed in which companies offer these discounts and can help you determine what your options are.