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With the high cost and environmental impact of gasoline these days, hybrid vehicles are becoming more and more common. Many owners wonder why hybrid car insurance is more expensive than insurance for gas-only vehicles and the answer has many components.
Look for car insurance for your gas-sipping hybrid right here by using your ZIP code in the FREE search tool!
Hybrid vehicles generally include a gas engine and some other propulsion system such as an electric engine that utilizes a battery of some sort. The gas engine is used to get the vehicle started and moving and then the electric engine takes over. Additionally, there are other technologies like alternative fuel vehicles that are quickly supplanting gasoline for a cheaper or cleaner running engine.
Your type of vehicle has a big impact on your insurance prices, as different makes and different models have a statistically higher tendency for generating car insurance claims. For instance, sport and high-performance vehicles generally have higher insurance premiums because they are statistically involved in more serious accidents than other types of vehicles. Similar reasons can account for some of hybrid vehicles’ higher insurance costs.
Hybrids are More Expensive
Hybrid vehicles are generally more expensive to insure due to one of the first rules of car insurance: vehicles that are more expensive will cost more to repair. This is as true for luxury vehicles and costly sports cars as it is for hybrid cars.
High-dollar vehicles are more expensive to insure because they are more expensive to repair after an accident, and hybrids can cost well over $25,000.
Hybrid vehicles are more costly and more expensive to repair after an accident because their parts are so specialized. Conversely, regular vehicles have been developed for decades, and their parts have been standardized as much as possible.
Parts for normal vehicles are widely available, and competition from generic parts manufacturers has driven down the price of standard parts. While not as common as a few decades ago, an average driver with some mechanical aptitude can still tinker around on the gas-only engine of their vehicle.
Hybrid vehicle parts are not so readily available because hybrids are still less common than standard engine vehicles and their prices reflect their rarity. Hybrid engines are not standardized to the degree of normal vehicles, as the technology advances and changes on a dime. One manufacturer’s hybrid engine is not exactly the same as another manufacturer’s engine, so there are few to no other sources for generic parts that are less expensive.
Auto insurance underwriters know that the claim for an accident for a hybrid will be higher than a standard car for exactly the same damage. To offset that future higher claim, they set insurance rates higher for hybrid vehicles.
Hybrids Need Specialized Mechanics
Another factor that will drive up the claim cost for a hybrid’s repair after an accident is the labor costs. Hybrid technology is cutting-edge, and most mechanics are well-versed in gasoline-only engines, not hybrid technology.
Hybrid vehicles must usually be repaired at dealership service centers. Even for conventional vehicles, having your car serviced or repaired at the dealership is more costly than at other automotive service garages and shops.
Mechanics who work on hybrid vehicles require additional training, and they are paid more for their advanced knowledge, as would happen in any industry. Again, car insurance underwriters factor in the higher labor costs associated with repairing hybrid vehicles when calculating insurance rates.
Hybrids are an Unknown Entity
Additionally, the relatively recent arrival of hybrid vehicles on the driving scene also increases the higher insurance costs of hybrids and alternative fuel vehicles. Car insurance underwriters look at claim loss statistics on every make and model as part of calculating base insurance rates. They look for trends that might show which vehicles are more likely to be in an accident, and which vehicles have higher claim amounts due to increased injuries.
Hybrid vehicles don’t have a long history of accident and claim statistics for insurance underwriters to study like with conventional vehicles.
That makes the claim data for hybrids an unknown entity. New hybrids arrive at the marketplace yearly, each with different engines, body styles, and additional technologies.
When faced with the unknown, car insurance underwriters will err on the side of caution and set higher base auto insurance rates for those models. This is not an uncommon practice; when auto manufacturers introduce a completely new model vehicle; insurance underwriters set higher insurance rates because claim data for accidents and losses is unavailable. The vehicle has not been put to the test in the real world, so to speak.
Even for vehicles that have a longer history, such as the Honda Insight and the Toyota Prius, technologies have changed and advanced so much that past data is not as useful as with conventional engine vehicles. Insurers will initially set higher rates to combat any future claims for a particular make and model that might be higher than expected.
Size and Use
Another factor that raises the cost of hybrid auto insurance is the nature of hybrid vehicles, according to an article on AOL Autos. Hybrids are naturally smaller vehicles in order to maximize their fuel economy and reduce emissions as heavier vehicles take more fuel to get around.
Unfortunately, smaller vehicles are at a disadvantage on a road filled with trucks, SUVs, and 18-wheelers, hybrid car or otherwise. Drivers in large vehicles are less likely to see smaller vehicles, leading to more accidents for those autos that are small in stature.
Smaller vehicles also come off the loser in such accidents, as would a Chihuahua dog in a fight with a Saint Bernard. Because smaller vehicles like hybrids will sustain so much more damage in an accident, their claims tend to be higher. Higher claims increase insurance rates every time.
Furthermore, the AOL Auto article also points out that hybrid vehicles are much more likely to be driven in high accident areas. Those drivers who have long commutes are more likely to drive their hybrids on the highway, where the really bad accidents occur. Increased mileage and an increase in highway driving may lead to an increase in claims, in both in the number of occurrences and the dollar amount of those claims. This again increases insurance rates.
Hybrids are also marketed to city drivers looking for small, economical fuel vehicles to get around a city or metropolitan area. Driving in urban areas also increases claims from crashes and theft, adding to insurance rates.
The Myth of Poor Hybrid Safety Ratings
One area that doesn’t necessarily increase the insurance rates of hybrid vehicles is safety ratings. When hybrids began to rise in popularity, many feared that they would be less safe than conventional vehicles due to lightweight materials used in their construction.
However, safety ratings have not displayed any correlation between low safety and hybrid vehicles. The Insurance Institute for Highway Safety has had hybrids on their Top Safety Pick list. In addition, the safety ratings from the National Highway Traffic Safety Administration have shown few differences between the safety ratings of hybrids and conventional vehicles.
For instance, the 2011 Ford Fusion and the 2011 Fusion Hybrid both received four out of five star safety ratings overall. The 2012 Honda Civic and the Civic Hybrid both garnered the same top five-star ratings. The 2012 Toyota Prius and the 2012 Chevy Volt both received five out of five star safety ratings overall. Safety ratings for hybrids are generally high, as no manufacturer wants to be known as the one who created a death trap that also gets really great gas mileage.
Find Hybrid Insurance Discounts
As hybrids increase in popularity, the demand for parts and alternative service center will lead to an organic growth in competition. Engines will become more standardized as the most reliable and effectual technology is identified. The costs for parts and labor will fall as generic parts are manufactured and privately-owned hybrid garages are established.
However, such developments will take years, and you probably want lower insurance costs now. Who doesn’t? There are a few ways that you can find lower prices when it comes to auto insurance while waiting for the repair industry to catch up.
For one, you can find car insurance providers that offer discounts for going green.
The specialists at the Insurance Information Institute advise that some insurance providers offer discounts up to 10% for policyholders who drive hybrid vehicles.
Companies understand that being viewed as environmentally conscious is important in today’s marketplace, so insurers will strive to reward those customers who embody such environmentally-friendly ideals.
Furthermore, drivers can also decrease their insurance premiums in exactly the same way that drivers of normal vehicles decrease their rates; they can decrease their risk in the eyes of the insurance companies. A good driving record is the best way to get low insurance rates from the get-go.
Furthermore, drivers of hybrid vehicles still need to shop around and compare quotes for insurance coverage, just like drivers of conventional vehicles should. Any insurance expert will tell you that getting multiple quotes will allow you to find lower rates. Car insurance companies all charge vastly different rates, and you just need to find the one that offers the lowest premium for you and your hybrid.
Start your comparison search on this page to get multiple car insurance quotes for your hybrid as soon as you put your ZIP code in the FREE search box!