Ask an Agent: How Does the Car I Drive Affect My Auto Insurance Costs?

Varied insurance rates are something to keep in mind when choosing the right car for you.

Midsize cars tend to have the best safety ratings—and thus the best insurance rates.

Mikbiz / Shutterstock

In our Ask an Agent series, we answer popular questions about car insurance with expert advice from AAA Insurance agents. In this installment, agent Sohil Yusuf sheds light on how your vehicle’s make and model can influence coverage rates.

Can the type of car I drive raise or lower my auto insurance rates?

Yusuf: Generally, the more expensive a car gets, the higher its insurance rating becomes. A mid-size, four-door sedan would be the standard insurance rating, and then there are higher ratings for trucks and SUVs. When you get into the luxury realm, the ratings go up even more because of the inherent cost of parts for a Mercedes or a BMW, for example, vs. a Toyota.

Will auto coverage for a compact car always cost less?

Yusuf: A lot of people think that compact cars would have lower insurance rates because they’re cheaper and cost less to own, but it’s the opposite: Smaller cars tend to have a little bit higher insurance rate than, say, midsize cars because midsize cars tend to have better safety ratings than small economy cars. The insurance rate for a Toyota Yaris, for example, would probably be higher than for a Toyota Camry or Corolla. Its price point is lower, so it doesn’t have as many safety features. That’s why [less expensive] cars sometimes actually cost you more on the insurance end.

Do power and performance impact how much I pay for coverage too?

Yusuf: Oh, yes. The most expensive cars we insure would be sports cars. Even the entry-level sports cars—like Mustangs, Camaros, and Dodge Chargers and Challengers—have relatively high insurance ratings. Because, if you think about it, who drives a sports car? Young males. Mustangs and Camaros are marketed to them. And when we’re young, we’re silly.

I shouldn’t say that—I drive a Mustang myself! But the faster [your vehicle can] go, the more expensive the insurance will be. And parts tend to be more expensive on those cars too, because they could be made of exotic materials. For example, normal cars get aluminum wheels, but I’ve seen BMW sports cars with magnesium wheels, and there are a few cars out there with carbon fiber wheels. Any time you get into a specialty body part on a vehicle, that can definitely impact insurance rates.

Do where I live and park my car affect my insurance rate?

Yusuf: Yes, zip code is one of the major rating factors. My geography is Sacramento, California, for example, and 95831 and 95832 are located right next to each other but have significant insurance rate differences. If you live in a residential neighborhood with no major freeways running through it, your insurance will cost less than if you live in a more urban zip code. If you’re in a downtown area where there are a lot of businesses, more people drive in and out of your neighborhood and [create] more chances of accidents happening.

How do anti-theft features affect auto insurance rates?

Yusuf: Safety features have to be factory-installed to affect your rates. Let’s say you get a higher-end BMW or Mercedes with built-in tracking software. If your car gets stolen, you call a phone number, and they can track where your vehicle is. Those types of anti-theft features tend to give you an insurance discount based on the vehicle identification number—the VIN—of your car. A base model of the same vehicle without that feature would have a higher rating.

About the Agent

Sohil Yusuf, who joined AAA in 2005, enjoys interacting with people and helping them with their needs. He loves that his job is different every day, and never routine.

  • Nickname: Bhai (Hindi for “brother”), as I was the oldest in my family. This was my childhood nickname, picked by my grandmother.

  • Hobby: Tinkering with cars.

  • First car: 1983 Honda Accord. It was as old as me!

  • Dream car: Ford GT.

  • Favorite vacation spot: Hawaii.

  • Favorite TV series: Netflix’s Dark.

  • Favorite film franchise: Star Wars.

Read more Ask an Agent articles:

How to contact AAA Insurance agent Sohil Yusuf:

AAA Greenhaven Branch
1056 Florin Rd.
Sacramento, California
(916) 288-2025
[email protected]

Provides assistance in English, Hindi, and Urdu.

The views and opinions expressed in this article are those of the interviewee and do not necessarily reflect the official policy or position of AAA. Products and their features may not be available in all states. Multipolicy and other discounts vary based upon eligibility. Discounts not cumulative; certain restrictions apply. Term Policy Form Series: ICC11-1201/TL-1201. Insurance products in California offered through AAA Northern California Insurance Agency, License #0175868, in Nevada by AAA Nevada, in Utah by AAA Utah, in Arizona through AAA Arizona, Inc., License #8301727, and in Wyoming through AAA Mountain West Inc., License No. 172603. The provider of AAA Auto and Home Insurance is CSAA Insurance Group, a AAA Insurer. All policies are subject to policy terms, underwriting, guidelines, and applicable laws.