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Top Safety Pick Won’t Lower your Car Insurance Premium

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Shuman Roy is an entrepreneur, business owner, and musician. He started RoysNoys, LLC in 2013 as a music production and education service company. He also offers small business consulting and advisory services to help businesses get from start-up mode to turn-key operations. Shuman earned his M.B.A from the Stern School of Business in 2001...

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Joel Ohman is the CEO of a private equity-backed digital media company. He is a CERTIFIED FINANCIAL PLANNER™, author, angel investor, and serial entrepreneur who loves creating new things, whether books or businesses. He has also previously served as the founder and resident CFP® of a national insurance agency...

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Reviewed byJoel Ohman
Founder, CFP®https://res.cloudinary.com/quotellc/image/upload/insurance-site-images/truthaboutins-live/2020/03/joel-ohman.jpg

UPDATED: Mar 13, 2020

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You probably won’t be offered a lower car insurance premium as a direct result of choosing to drive a vehicle with a higher safety rating.

Higher safety ratings are associated with minimizing bodily injury in the event of an accident.

Insurers don’t offer lower premiums for this because they aren’t on the hook for paying a bodily injury claim from their own insured.

Here’s why…

If a person is injured in an auto accident, the other driver’s insurance company would be on the hook for the claim if their driver was at fault.

There is no coverage on an auto policy for injuring yourself. Therefore, an insurer wouldn’t realize any benefit by offering a lower premium to an insured with a “safer” vehicle.

However, the physical damage portion of your policy premium can vary depending on the type of vehicle you drive.

Note: Personal Injury Protection and MedPay coverage DOES insure an individual for minor bodily injury in an instance where they are injured in their own vehicle and there is no other party at-fault, but this coverage is typically very limited. Obtaining high limits of either coverage is not cost effective by any stretch.

Car Symbols

Each vehicle manufactured for sale in the United States is assigned a “symbol.”

For the most part, you can expect to pay a higher premium for a higher symbol vehicle (although you will probably go your entire life without knowing what “symbol” is assigned to your vehicle).

The symbol is typically a number (can be a letter) within a certain set; 3-26 for example.

The symbol your vehicle is assigned is comprised of a number of factors including, but not limited to, the frequency of accidents and thefts of the particular model as well as the typical costs to repair any damage it may suffer as a result of an accident.

You may also see higher symbols for more expensive and faster vehicles (for the same model).

For example, a turbo-charged Subaru WRX would have a higher symbol than a non turbo-charged Subaru WRX.

Getting a Vehicle with a Lower Symbol

As alluded to above, less expensive vehicles generally have a lower symbol.

This is not necessarily the case all of the time. You might find some more expensive vehicles that have lower symbols than less expensive cars if they are generally not in as many accidents or stolen as often.

A Ford Mustang may have a higher symbol that a four door family sedan that cost more brand new because Mustangs have a higher accident frequency.

Here are some tips on determining where a particular vehicle may fall:

– Vehicles with larger motors typically have higher symbols.

– Vehicles with two doors likely have higher symbols than four door vehicles (2 door vehicles are usually “sport” models, and are associated with more accidents.

– Your 4X4 truck will probably carry a higher symbol than a 2-wheel drive model. It costs more to repair a four-wheel-drive drive train if damaged in an accident.

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