|NEW TECH COULD MEAN INCREASED PREMIUMS|
|Posted on: Jan. 02, 2017 in Auto Insurance, Cars|
Newer cars generally mean higher insurance premiums. The reason is fairly simple: a newer car has a higher value; therefore, it costs more to replace. If you’re financing your vehicle, you may also be required to purchase more insurance than someone who owns their car outright. But one thing has changed recently that is causing insurance premiums to rise in a way that many have not seen before, and that’s technology.
As new innovations continue to come onto the market, the cost of cars and their replacement parts will likely continue to increase. It’s not just the computers and gadgets that are expensive. In an older model vehicle, a bumper was just a bumper. Now, a bumper comes equipped with advanced safety features such as sensors and cameras that aid in collision avoidance, parking, and more.
Generally, the more claims a car insurance company has to pay out, the more it will have to charge its policyholders. For that reason, when car accidents are on the rise, the cause of insurance goes up. It would seem like these new devices that make car travel safer would ultimately decrease the cost of insurance. But in this case, because these new technologies are so expensive, even as they save lives they are costing more.
So does that mean you should avoid buying a car with advanced safety features? Absolutely not! It just means that if you’re in the market for a new car, you’ll want to do some research about what the cost of insurance will be for the vehicle models you’re considering. A safer car is generally the better bet and usually a good use of the money you have for a car, but knowing the true cost of vehicle ownership is always something to be aware of before you buy.
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