Rachel Bodine graduated from college with a BA in English. She has since worked as a Feature Writer in the insurance industry and gained a deep knowledge of state and countrywide insurance laws and rates. Her research and writing focus on helping readers understand their insurance coverage and how to find savings. Her expert advice on insurance has been featured on sites like PhotoEnforced, All...

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Jeffrey Johnson is a legal writer with a focus on personal injury. He has worked on personal injury and sovereign immunity litigation in addition to experience in family, estate, and criminal law. He earned a J.D. from the University of Baltimore and has worked in legal offices and non-profits in Maryland, Texas, and North Carolina. He has also earned an MFA in screenwriting from Chapman Univer...

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Reviewed by Jeffrey Johnson
Insurance Lawyer Jeffrey Johnson

UPDATED: Apr 13, 2022

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There is nothing quite like the smell of a new car. While it may be insignificant in the long term, just being greeted by the aroma of new car scent each time you sit behind the wheel of a new car is a rewarding experience for many.

But there’s much more to buying a new car to consider than the way it smells. The addition of a new car can has a significant impact on your car insurance policy premiums, by either raising or lowering the amount you have to pay. It is important to know how to reduce the cost of car insurance before buying.

Getting the right car when you purchase a new vehicle is one of the keys to saving on your car insurance. If you have already bought a car, use our free insurance tool to compare car insurance rates in your area.

Here are the things you should be looking for when you buy your next car in order to save on auto insurance.

Tips for Buying a New Car

Before you start researching buying a new car online or from a dealership, first make sure that it is a good time to buy. Factors such as car shortages and high demand can drive up prices, leading to market oddities like cars worth more used than new and making it a poor time to shop.

Familiarize yourself with what to ask when buying a new car from a dealership. If the car market is operating normally, check out our following tips and tricks when buying a new car.

Search for Cars by Safety Features

One of our tips for buying a new car from a dealer is to look at safety features. Modern cars have come a long way from the early days of automotive history. Nowhere is this transition more apparent than in the additions of new technology designed to save lives.

Many of these safety features we take for granted, but they’re still evolving. Seat belts, airbags, crumple zones, all-wheel-drive, anti-lock braking systems, technology that protects pedestrians, traction control, and things like electronic stability control save lives every day.

You should seek out new cars with as many basic safety features as standard equipment. Test driving the car before will also give an idea of how the safety features work. Not only will it save you on your car insurance premiums, but more importantly, those safety features may save your life as well.

Consider Car Size

While the statistics confirm that cars continue to become safer with each successive generation thanks to the addition of new technology, the size and mass of an automobile have a significant effect on its overall safety ratings.

The National Highway Transportation Safety Administration (NHTSA) says that the heavier a car is, the better it will protect you in the event of an auto accident or crash. Especially in the case of an accident that involves two vehicles.

Larger cars, unlike compacts, offer superior survivability and lower incidents of major losses, which means they reduce an insurer’s risk.

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Look at Industry and Government Safety Ratings

There are two main entities in the United States that rate cars for safety by conducting a battery of safety tests on the cars, including crashing them in controlled environments.

On the governmental side, the National Highway Transportation Safety Administration (NHTSA) does this, with their ratings based on a 1-to-5 star system. On the insurance side, the Insurance Institute for Highway Safety (IIHS) does more advanced testing than the federal government and rates automobiles as Good, Acceptable, Marginal, or Poor.

Selecting a vehicle that obtained an overall five-star rating from the NHTSA or “Good” from the IIHS, especially if the car has been named an IIHS Top Safety Pick, will offer you the best possible chance of a lower auto insurance premium.

Get a Car with Low Loss Statistics

Because insurance works on the concept of minimizing risk, cars that fare worse in crashes and cost more to repair will have the highest premiums on average. The entire industry looks at their losses for each make/model and prices premiums based on their experience with the vehicle.

Cars with the least amount of losses are often minivans. There are numerous resources that show what cars are the cheapest to insure, such as our ranking of the the top 10 cheapest cars to insure.

Get a Car with Low Theft Statistics

Just like certain cars are more popular with buyers, the same is true for auto thieves. They prefer to steal certain cars depending upon different factors. Certain models, such as the Toyota Camry and Honda Accord, appear on their radar because of the vast market for auto parts. Others, like luxury and exotics, are attractive because they have willing buyers.

Selecting a car that has an average or lower theft occurrence rate will be reflected in your policy premiums. Likely, your insurance will be lower, while vehicles that have higher theft rates will have higher premiums.

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Frequently Asked Questions: Purchasing a New Car

If you have some questions about buying a new car, we’ve gone over the most commonly asked questions. Rather than researching
buying a new car on Reddit, read on to see what others are asking about the car buying process.

#1 – How much can be negotiated off a new car?

If the car is in high demand, it will be harder to negotiate the price down, even if you know what to say when buying a new car. However, if a car is in low demand and not selling, you could negotiate a lower price. It is wise to research in-depth how to buy a new car for the lowest price before going to a dealership.

#2 – Is 2021 a good time to buy a new car?

No, 2021 is not a good time to buy a car due to car shortages driving up prices. It is better to wait until demand goes down and prices drop.

#3 – Is buying a new car a good investment?

Buying a car is never really an investment, as they depreciate rather than grow in value. However, a car is an asset, as you can sell it if needed. Just keep in mind it will be worth less than what you bought it for.

#4 – What is the cheapest way to buy a new car?

If you buy upfront with cash or check, rather than leasing out a car or getting a loan, it will be cheaper if the lease or loan has an interest rate. You should also research the car beforehand and shop around at multiple dealerships to make sure you are getting a fair price. If you are getting a loan, make sure to be pre-approved before you go shopping.

#5 – Is it worth buying a new car?

If you are one of the drivers asking why you should never purchase a new car, the answer is that it might be more economical to buy a used vehicle. Even buying a vehicle that is a year or two old can save you a fair bit of money.

In the end, your auto insurance policy should be tailored to specifically meet your needs. Even if you’re not interested in the safest car, or particularly worried about the cost of your policy premiums, keeping the list above in mind when you buy a new car can still save you money in the long run.

If you are ready to start shopping for insurance rates for your new car, enter your ZIP code into our free quote comparision tool below.


  1. https://www.nhtsa.gov/