8 insurance tips for buying your first car

You’re finally shopping for your first set of wheels. But before you sign on the dotted line, it might be a good idea to keep your car insurance in mind.

If you’re buying it for the first time, that may be daunting. But with the help of an insurance broker, it won’t be difficult. There are, however, some things to keep in mind.

In Canada, the basic coverage you must have is liability which covers you for the cost of anyone injured or property damaged. If you choose to buy a cheaper car – let say a used one - a basic plan might be a better choice.

One of the ways a new driver can make sure their car insurance premiums stay low is by buying the right vehicle. Quite simply, safer cars are less expensive to cover. Newer and expensive models have the potential to drive up rates. Why? Because in the event of an accident, they are more expensive to repair and replace.

Vehicle brands and model years are rated riskier or less risky, determining their cost to insure, using the Canadian Loss Experience Automotive Rating (CLEAR).

CLEAR determines how much an insurance premium for a vehicle should be, based on car insurance claims data from Canada and the U.S. Essentially, it’s an assessment of the expected and actual claims loss for each make, model and model-year of a vehicle. Anti-theft devices, anti-lock brakes, top-notch tires, side-impact door reinforcements as well as dual and side airbags all create a lower auto insurance quote under the CLEAR system.

Basically, insurers want to know what kind of car you drive, where you live, your gender, about your car’s safety features, your driving history - which includes any tickets, driving violations – and the level of your driver’s licence. But there are some things to keep in mind when trying to find the right policy and the best premium for those new wheels. Here are some tips:

1. Shop around online – Compare prices, coverage options, and service. You may receive a discount for being a student and requesting an online quote. Rates can vary from insurer to insurer. Getting as many quotes as possible will help give you a clearer picture.
2. Compare the same policies– Make sure you are comparing apples to apples. You may think saving 25 per cent on your premium might be attractive, but if it comes at the cost a lower liability coverage amount, you have to ask yourself if that's worth it. So, when you look at different policies don’t just consider premiums, think of liability too.
3. Choose a higher deductible– This is the amount you pay in the event of an insurance claim to lower your premium. That being said, make sure it’s one you can afford to pay.
4. Go to driving school– If you’re a young driver, many insurers offer a discount if you’ve taken a certified driver’s education course. It’s worth the investment and will make you a safer driver in the long run.
5. On the honour roll? – Don’t be shy, tell insurers about it. You may be eligible for a reduced premium if you maintain a certain average and can provide transcripts.
6. Put safety first– The more safety features your car has, the less likely is it to be stolen or involved in an accident. That means lower premiums.
7. Get a quote from your parent’s insurer– If you’re still living at home, discounts may be given for having more than one car on the same policy.
8. Ask about discounts– It can pay to inquire. You may be eligible for certain deals if you graduated from a particular university, have a clean driving record or belong to a union. Winter tires? They can qualify you for additional savings.

If it still seems a lot to think about, an insurance broker will help walk you through choosing the right policy. Understanding what your policy covers is an important first step.