Used car insurance rates tend to be less than premiums of newer comparable model years. You might even be able to lower your premium even more by reducing coverage. Just be sure to keep enough coverage so you’re not left financially stranded after an accident.
How can I save on car insurance for used cars?
In some cases you may pay a high premium for your used car if it’s a high-quality make and model. In this case, there are still several ways to save money:
- Multiple discounts. Check into policies that include discounts you might qualify for, like insuring multiple cars or bundling policies together.
- Safety features. Make sure your car includes airbags, antilock brakes and an antitheft device for extra discounts.
- Low mileage. You could look into pay-as-you-go insurance if you only drive your used car for short distances like local commuting.
- Minimal coverage. If your used car is only worth a few thousand dollars, you might opt out of physical damage coverage and save for another vehicle instead. Just make sure you’re not left paying more out of pocket than the coverage would cost.
Case study: Roslyn’s experience
Car insurance Publisher
I used to drive a 2002 Jeep Liberty as my daily commuter car. In 2014, I checked KBB and found my car was only worth about $3,000, but my insurance was costing me about $1,000 a year. I was definitely overinsuring my car.
I wanted to save on insurance so I could save up for a new car. I decided to switch to a bare-bones policy just above the state minimums. I removed comprehensive and collision coverage and switched to a $1,000 deductible. You can’t usually get roadside assistance without comprehensive coverage, so I got a AAA membership since my aging car was becoming less and less reliable.
By cutting coverage I didn’t need anymore, I saved about $400 and cut my annual insurance premium to $600.
How much is car insurance for a used car?
The average car insurance rate is $1,300 per year, and rates for used cars tend to stay around this price.
However, your used car may cost less than average, depending on its exact age and make. For example, a 2007 minivan may only cost around $930 per year to insure, while a 2017 model costs $1,100 per year.
Used cars will be more expensive to insure if they have a high MSRP, are equipped with fewer modern safety features, have high theft rates or require specialty parts, among other factors.
Cheapest barely used cars
|Model year||Make and model||Average monthly premium|
|2017||Volkswagen Golf R||$145|
Get the right car insurance for your used car
What kind of coverage does my used car need?
Your used car needs basic protection to get you on the road. You may need:
- Bodily injury liability. Take responsibility for injuries you cause to other drivers and passengers and fulfill state requirements.
- Property damage liability. Pay for property and vehicle damage in an at-fault accident, without paying out of pocket.
- Comprehensive. Get extra protection for incidents involving theft, storm damage or hitting an animal. Could be unnecessary for older models, especially if the deductible costs more than your car is worth.
- Collision. Consider this standard add-on to repair damage to your own car. If you drive an older vehicle in a busy city or during high-traffic times like rush hour, this coverage is beneficial.
- Uninsured and underinsured motorist. Make sure you can pay for car repairs and medical bills when the at-fault driver doesn’t have enough insurance. Required in some states, but not always needed for a cheap used car.
- Personal injury protection. Helpful for medical bills and income loss for accident-related injuries. May be a legal requirement in some states. Not always needed if you and your regular passengers have good health insurance.
Do older used cars have different insurance requirements?
No, used cars have the same legal requirements as other cars on the road. Those requirements include liability and may also include uninsured and underinsured motorist or personal injury protection coverage in some states.
However, your used car could qualify for a classic or antique policy if it meets the requirements. These policies often require garage storage and low mileage, but some insurers allow daily driving. Classic car insurance typically costs less than regular car insurance.
- Classic car. Many cars will qualify if they’re at least 15 years old. Example models include the 1996 Chevrolet Impala SS, 2000 Acura Integra Type R and 2001 AM General Hummer.
- Antique car. Most insurers consider cars antique if they’re over 25 years old. You may need to have restored the car in some way.
What add-on coverage should I consider for my used car?
Used cars may need additional protection to help you avoid paying for unwanted expenses. Consider these coverage types:
- Roadside assistance. You never know if your used car is going to have a mechanical breakdown. Get help with towing, battery jumpstarts or tire repairs when needed. This is the one coverage you should likely consider for a less reliable older car, especially once the three or five year warranty runs out.
- Loan or lease gap. If your used car is totaled, it’s likely you’ll owe more on a loan or lease than the claim payout for your car’s actual value. Cover the difference if that happens. You only need this for used cars you financed — drop it once your loan is paid off.
- Rental reimbursement. Consider this option so you’ll have something to drive if your car is in the shop. Otherwise you can skip this coverage on an older car if you could manage getting around without a car for a while after an accident.
Are used cars cheaper to insure than new ones?
Typically, yes. A lightly used car with a solid safety rating will likely be less to insure than a new car.
The difference in the cost to repair and replace a used car versus a new is what makes the difference in insurance rates. Since the potential payout for repair or replacement of a new car is typically significantly higher, even safety technology discounts don’t typically drop the rate lower than a used model.
Get car insurance for a used car in 5 steps
Getting auto insurance on a used car works the same as with a new car. However, some insurers exclude older car models in the online quoting process. You may need to call about getting a policy in this case.
Steps to apply for car insurance:
- Start an online quote by entering your ZIP code, or call a customer service representative.
- Fill in personal and vehicle information, especially your car’s make, model and age.
- Choose coverage and confirm information.
- If calling, consider asking the representative if your car qualifies for classic car insurance.
- Enter bank account or credit card number for payment, then finalize details.
What should I watch out for?
Used cars do have a few caveats for getting the right amount of insurance, including:
- Theft coverage. Thieves often prefer older cars to new models since they can sell them for parts more easily. If skimping on coverage, consider keeping comprehensive.
- Car value versus insurance. Consider the coverage you need for the value of your car. If you have an old car and sufficient savings, it may not be worth the extra premium.
- Upkeep for safe driving. Used cars need more maintenance than new ones to keep them safe on the roads.
Used cars have similar insurance needs as other cars but often cost less to insure. To save more, consider multiple discounts, lower coverage on a less-valuable car or looking into classic car insurance.
See which auto insurers fit your car insurance needs best to get the right protection at a fair price.
Frequently asked questions about used car insurance
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