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Many Americans forget about car insurance costs when car shopping

When it comes to the cost of buying a new vehicle, the story runs a lot deeper than the price tag on the window. In addition to considering the expense of monthly payments, maintenance and gas mileage, consumers also need to think about what their new wheels will cost to insure.

auto insurance and car shopping However, it turns out auto insurance rarely crosses their minds.

According to an April 2014 study of 1,010 adults conducted by Princeton Survey Research Associates International, 46 percent of American car buyers don't get an insurance quote until after they've already purchased a vehicle. However, 42 percent said they thought it would be very important to know the cost of car insurance before buying a car.

American consumers also indicated the cost of auto insurance could be a significant factor when considering what type of car to buy. According to the survey, when buying a car in the future, 40 percent of respondents said they'd be less likely to buy one that costs more to insure.

"This is unfortunate but not very surprising," says Joe Wiesenfelder, executive editor of the car-shopping site "I've found that there's usually a disconnect between what car buyers say is important to them and what they actually do when car shopping. Because, by and large, people just want to buy the car they want, and they're willing to overlook a lot of other factors that may get in the way, including the cost of insurance."

How getting a different car affects car insurance rates

Insurance rates vary from car to car - and, in some cases, your car insurance rate can change significantly even if you're planning on buying the same make and model but with a bigger engine. And other factors can affect your rate too - for example, if you wanted to purchase a  1994 Honda Accord, which was the most stolen car in the U.S. in 2013, you may end up paying more for insurance than for a different car that's a similar age and model. This is because insurers typically charge more to insure a car that is popular with car thieves.

According to Mike Barry, spokesman for the nonprofit Insurance Information Institute, auto insurance premiums are based on many factors, including the car you drive.  

The bottom line, Barry says, is that some cars cost more to insure than others, and that cost is based on several variables, including the likelihood of theft, the cost of the car itself, the cost of repairs and the overall safety record of the car. 

"I'm really surprised to hear that 46 percent of Americans got an insurance quote after buying a new car, given the importance a car's make and model can have on pricing an auto policy," Barry says.

What's more, Barry adds, insurers look at the potential damage a car can inflict on another car if it's involved in an accident. If your car has a higher chance of inflicting damage on another vehicle and its occupants—a large SUV for instance—some insurers may charge more.

Shopping for car insurance? Get your free car insurance quotes here.

Using the car shopping tool, we found that:

  •  A 30-year-old single male living in San Mateo, Calif. would pay 10 percent more to insure a 2014 Subaru Outback 3.6R Limited than the less powerful 2014 Subaru Outback 2.5l.
  •  A 40-year-old married female living in Orlando, FL would pay 6 percent LESS for insuring a 1994 Chevrolet Malibu than a 1994 Honda Accord (America's most stolen car in 2013). 
  •  If a 28-year-old single male living in Westchester, NY, wanted to upgrade his 1999 Honda Civic EX to the 2013 model, his new insurance rate would be 7 percent higher. 

Why car insurance is overlooked when buying a car

According to Phil Reed, senior consumer advice editor for the car-shopping site, consumers typically begin car shopping for one of two reasons: Either they need a vehicle or they're excited by the thrill of buying something new.

"It's usually an emotional decision either way, which means there are factors affecting their behavior they may not be aware of," Reed says.

One of those factors is overlooking what Reed calls a car's "invisible costs," which include maintenance, fuel economy and, more than anything else, auto insurance.

"Most people go into car shopping with a sense of excitement about what they're about to buy, and insurance just isn't part of that excitement," Reed says.

Industry expert Carlton Wolf calls this "falling under the ether."

"A car dealership doesn't really want you to get quotes on auto insurance because that can break the spell of the car-buying experience," says Wolf, a former car dealer who now publishes, a website designed to help consumers shop smartly for new and used cars. "If you get an insurance quote before buying the car, you might suddenly think, 'Oh my God. My car payment is going to be $500 a month, but my insurance is going to cost another $200.' That can significantly change your mind about the vehicle you thought you wanted."

Even when consumers are aware of the so-called hidden cost of auto insurance, Wiesenfelder says most consumers just don't want to educate themselves.

"Consumers say they want as much information as possible before buying a car, but that doesn't mean they're willing to find that information themselves," Wiesenfelder says.

Insurance tips when buying a car

"First of all, consumers need to get motivated about the importance of knowing what they will pay for car insurance before they start actively shopping for that new vehicle," Reed says. "They need to understand that a little extra research will pay off for years down the road, and possibly save them some money."

Here are 3 insurance tips to follow when buying a car:

1. Get several quotes.

According to Wolf, consumers should first obtain a few different car insurance quotes before they take a trip to the dealership. "If you know the type of vehicle you're interested in, go online and get several (insurance) quotes so you know what it's going to cost before you start shopping," Wolf says, adding that getting quotes is easy and free.  

2. Call your agent.

If you're already insured, Reed suggests calling your agent to discuss the financial impact of buying a new car. "It's important not to make any assumptions," Reed says. "Tell them you're thinking about buying a certain type of car, and ask them how that will impact your premium."

3. Ask about the following discounts.

  • Loyalty discounts for staying with the same insurer for more than five years.
  • Student discounts for high school or college students.
  • Safety discounts for having a clean driving record.
  • Military discounts for armed service members and their families.
  • Affinity discounts may apply if you’re a member of certain official organizations. For instance, Geico offers affinity discounts up to 8 percent for fraternity or sorority members as well as other organizations like the National Society of Accountants and various state bar associations.
  • Discounts for being married.

"Even if you're already insured, you probably haven't looked at your policy in a long time," Wolf says. "Now is the time to talk to your agent and find out if there are discounts out there that could save you money and help you afford the new car you really want."

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