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After years of making do with clunkers, I bought my first true new car, a little Nissan Versa. I enjoyed all of its cool features and that delicious new car smell for all of three weeks. Then, another driver ran a red light, plowed right into me, and totaled my beautiful car.
Thankfully, I walked away unscathed, but it was still a painful lesson in the importance of having the right car insurance. With the average cost of new cars nearing $50,000, you want to make sure your vehicle is properly protected.
To keep your wheels safe without breaking your budget, do your research and get quotes from multiple companies that offer the best car insurance for new cars. I found that GEICO, Root, and Progressive are among the top companies for auto coverage.
How we evaluate products
FinanceBuzz researches a number of factors in each auto insurance provider to create our reviews. These factors include cost and discounts, complaints and customer satisfaction, coverage, and ease of use. We also gather information from sources such as Insurify, J.D. Power, AM Best, the National Association of Insurance Commissioners (NAIC), and the Better Business Bureau to ensure we provide the most useful information to our readers.
FinanceBuzz researches a number of factors in each auto insurance provider to create our reviews. These factors include cost and discounts, complaints and customer satisfaction, coverage, and ease of use. We also gather information from sources such as Insurify, J.D. Power, AM Best, the National Association of Insurance Commissioners (NAIC), and the Better Business Bureau to ensure we provide the most useful information to our readers.
GEICO is one of the few companies I evaluated that offers mechanical breakdown coverage, an optional benefit you can add to your new car policy. It pays for repairs if your car’s major systems or components break down due to reasons other than normal wear and tear.
Plus, GEICO’s rates are among the cheapest, and it has an extensive list of discounts that can help you further lower your car insurance premiums.
However, GEICO’s claims satisfaction rating from J.D. Power is slightly below average. It also doesn’t sell GAP insurance, so you’d have to purchase that coverage from the dealership or another insurance company.
Learn more in our GEICO review.
As a new car owner, you’re likely more cautious when you drive to keep your new ride safe. If so, you may benefit from signing up for usage-based insurance (UBI) through Root. This insurer bases your policy premiums on your driving habits and the number of miles you cover. Safe drivers who cover fewer-than-average miles can slash their car insurance costs.
But Root isn’t available everywhere. You can’t get a policy in Alaska, Hawaii, Idaho, Maine, Massachusetts, Michigan, New Hampshire, North Carolina, New Jersey, New York, Vermont, Rhode Island, South Dakota, Washington, Wyoming, or Washington, D.C. Plus, the company has a higher-than-average volume of NAIC complaints.
Learn more in our Root review.
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Get rewarded with savings for having a clean driving record.
Car insurance can be so simple. And so affordable.
Enjoy personalized policies, comprehensive coverage & more.
Drivers who switch their auto insurance and save with State Farm save $764 on average!
Besides offering the usual coverage options (like comprehensive and collision insurance), Progressive has optional coverages and add-ons that can be useful for new car owners.
It offers car loan or lease payoff insurance, which is similar to GAP insurance in that it pays for the difference between your loan or lease balance and your car’s value (up to a set maximum). Plus, you can get a vehicle protection plan to protect your car’s systems and components.
However, Progressive has a less-than-stellar reputation for customer satisfaction. Your rates are also partially dependent on how you purchase the coverage; some purchase methods are more expensive than others.
Learn more in our Progressive review.
GAP insurance helps pay for the difference between your remaining loan or lease balance and your car’s actual cash value at the time it’s declared a total loss. Not all car insurance companies sell GAP insurance, but American Family offers it as an optional coverage.
Plus, American Family has numerous discount programs that can make your auto insurance policy more affordable, such as low-mileage and autopay discounts. The insurance company also has a very low volume of NAIC customer complaints.
However, American Family only operates in 19 states, and it has a smaller agent network than major car insurers like State Farm.
Learn more in our American Family review.
- You could save up to $600 with some companies.
- Compare dozens of providers in under 5 minutes.
- Fast, free, and easy way to shop for insurance.
- Quickly find the perfect rate for you.
Average rate:
Average rate:
As I found out, replacing a new car after an accident can be financially challenging. Despite being just a few weeks off the lot, my car had depreciated in value, so my insurance settlement wasn’t enough to buy the same year, make, and model. I had to tap into my own savings to cover the additional cost to replace my car.
That’s where added protection like Liberty Mutual’s new car replacement would have been useful and saved me thousands. For the first year after you purchase your car, Liberty Mutual will provide funds to buy another brand-new vehicle if you were to total yours or have it stolen. This helps ensure you won’t have to worry about depreciation affecting your claim payout.
However, Liberty Mutual may be more expensive than other companies for both full coverage and liability policies. It also has a significantly higher-than-average volume of complaints with the NAIC and below-average customer satisfaction ratings on some platforms.
Learn more in our Liberty Mutual review.
As a new car owner, you’ll likely need the following forms of auto insurance coverage.
Liability insurance is required in nearly every state to legally drive a car. Liability coverage has two components: bodily injury protection, which pays for injuries to another driver or their passengers, and property damage protection, which pays for damages to another person’s vehicle or other property.
Collision insurance pays for repairs to your own vehicle if it’s damaged in an accident. It’s optional, but if you bought a new car with an auto loan or leased the vehicle, the lender will likely require you to have collision coverage.
Comprehensive coverage pays for repairs to your own vehicle due to non-accident damages or losses, such as storm damage or vandalism. It’s an optional form of coverage, but it’s usually required if you financed or leased your vehicle.
I had paid cash for my new car, so I didn’t have to worry about paying off an auto loan. However, if I had financed my car, I would have been in a pickle since it had depreciated in my three weeks of ownership; I would have owed more than it was worth.
GAP insurance is for this scenario. If your car is stolen or totaled, GAP insurance covers the difference between the balance owed and your car’s value at the time of the incident.
A new car can be expensive, so you want to make sure your new vehicle is protected. These optional add-ons can help you keep your car in showroom condition.
Although new cars are usually more expensive to protect than older models, there are several ways to save money on car insurance, including:
How much does insurance cost for a new car?
On average, new car owners pay $3,048 per year for full coverage, a higher rate than the average premium for all vehicles.
Is car insurance cheaper for newer cars?
In general, new cars are more expensive to insure than older models because of their higher sticker prices and values. However, you may qualify for discounts due to the new car’s safety features.
Which insurance company is best for new car owners?
No one company is best for all new car owners, but I found that GEICO and Root typically have the lowest rates. Depending on your needs, another company like Liberty Mutual or Progressive, which offers additional features, may also be a good option.
On average, new car owners pay $3,048 per year for full coverage, a higher rate than the average premium for all vehicles.
In general, new cars are more expensive to insure than older models because of their higher sticker prices and values. However, you may qualify for discounts due to the new car’s safety features.
No one company is best for all new car owners, but I found that GEICO and Root typically have the lowest rates. Depending on your needs, another company like Liberty Mutual or Progressive, which offers additional features, may also be a good option.
A new car is a big purchase. Before you start adjusting the seat and steering wheel settings, make sure you have the right car insurance policy in place.
Depending on the amount paid for the car, its value, and your comfort with risk, you may need a full coverage policy that includes liability, collision, and comprehensive insurance as well as add-ons such as GAP coverage and new car replacement protection.
Because rates differ between companies, get quotes from several providers. Our picks for the best car insurance companies are an excellent starting point.
- You could save up to $600 with some companies.
- Compare dozens of providers in under 5 minutes.
- Fast, free, and easy way to shop for insurance.
- Quickly find the perfect rate for you.
Average rate:
Average rate:
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