Prius High Cost of Insurance (in USA)

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wlcna - 02 Nov 2007 05:58 GMT

Why is the Toyota Prius expensive to insure? While contemplating a new car
purchase this fact has come to my attention (this is in the USA, I think
I've heard other places the Prius is cheap to insure).

Below you can see the Prius is near the very top of all cars in the general
class of smaller 4-door sedans.

Edmunds.com total cost of ownership, first year of insurance:

$1522 08 kia rio (!)
$1497 08 Prius
$1393 08 VW Jetta
$1384 08 Toyota Corolla
$1332 08 Mercury Milan
$1323 08 Honda Fit
$1179 08 Chrysler Town and Country
$1168 08 Chrysler PT Cruiser

I did not rely on these figures alone but have been checking my prospective
cars out with various insurance companies, including Geico, my current
company (not Geico) and a couple others.

While all these companies had some different ideas about cars in the middle
of the list, with significant variations, **they all agree** that the Prius
belonged near the very top for most expensive cars to insure (btw, the kia
as well seemed to consistently do extremely poorly in this comparison).
And the difference was *significant*, similar to the above edmunds listing.

I would have though the Prius would be relatively cheap to insure, so this
seems quite irritating. It has anti-theft technology built-in, it is a
"family car" largely, it is relatively slow and hence noone is going to buy
it to drive it fast at all, etc etc.

Of course the high insurance detracts from the long-term money saving
appeal of the car.

Anyone know why it's so expensive? The only valid reason I can think of
might be high resale value, leading to high replacement cost value, but
frankly I don't really believe that because other cars that go for more,
like that Town and Country up there, are very cheap to insure. Of course
I've also learned that minivans are about the cheapest vehicles on earth to
insure...

Anyone know more about this phenomenon? Are people out here generally
aware of this? Anyone think of any aspects of the car that would lead it
to have much higher rates?

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Michelle Steiner - 02 Nov 2007 07:30 GMT

> Below you can see the Prius is near the very top of all cars in the
> general class of smaller 4-door sedans.
>
> Edmunds.com total cost of ownership, first year of insurance:

My current policy's premiums are $285.88 for six months. I have
100/300/50 liability (same coverage on uninsured and underinsured
motorists), with 100/250 deductible on comprehensive/collision.

This is for a 2004 Prius with the most expensive option package
available.

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wlcna - 02 Nov 2007 18:30 GMT

"Michelle Steiner" <michelle@michelle.org> wrote...

>> Below you can see the Prius is near the very top of all cars in the
>> general class of smaller 4-door sedans.
[quoted text clipped - 7 lines]
> This is for a 2004 Prius with the most expensive option package
> available.

Thanks for the info, but it's actually off topic since I'm talking about
"comparative" rates, though I would like to know your secret for being in
such an amazingly cheap bracket (if there is a secret that would be usable
by others, e.g. that wouldn't require moving to a farm or something :). I
can tell you I'm a middle-aged male in a large Midwestern city with perfect
record over say last 10 years and I'm seeing rates nowhere near what you
are claiming here, closer to double and I have never even looked into $100
deductible.

But my topic is more like what you *would be* paying with say a PT Cruiser,
Pontiac Vibe, Honda Fit, etc. Have any info on that? The PT Cruiser for
some reason is almost always one of the absolute cheapest to insure
(similar rate to a minivan usually), that's why I mention it.

But I believe for any given person the Prius seems to be always more
expensive than say a Honda Fit, in most cases significantly so (though for
some insurers Honda Fit is not very far from Prius either), though the Fit
can be pretty high too.

Here's some examples of my quotes *in percentage terms* with Prius versus
Fit and then one vehicle that was at the cheaper end of things for that
insurer:

Allstate Prius 7% higher than Fit, 31% higher than PT Cruiser.
Progressive: Prius 13% higher than Fit, 25% higher than Pontiac Vibe.
Edmunds: Prius 13% higher than Fit, 28% higher than PT Cruiser.

(Edmunds link so people can try for themselves:)

http://www.edmunds.com/apps/cto/CTOintroController

Like I said the different insurance companies do seem to have different
ideas about which vehicles should be cheaper and more expensive, but some
things are obvious checking with say the 3 or 4 insurers I've checked with,
like that the Prius is generally more expensive to insure than almost any
similar car on the road, it's almost always right up there next to the Kia
Rio (and I have no idea why that car is so expensive).

Relatedly, I noticed that small cars generally are expensive to insure,
which I wouldn't have expected since generally they are much cheaper to
buy, including the domestically-branded Chevy Aveo being quite expensive to
insure (though I know it's made by Daewoo).

Another question here might be if anyone knows a good, economical small car
that's also among the cheaper to insure...? PT Cruiser is the closest
thing I can see but it's not particularly good on gas.

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Michelle Steiner - 02 Nov 2007 18:59 GMT

> Thanks for the info, but it's actually off topic since I'm talking
> about "comparative" rates, though I would like to know your secret
> for being in such an amazingly cheap bracket (if there is a secret
> that would be usable by others, e.g. that wouldn't require moving to
> a farm or something :).

Actually, I live in a suburb of Phoenix, which has some of the highest
insurance rates in the country. When I moved here from the San
Francisco Bay area, my insurance actually went up.

But I'm insured with USAA, which has some of the lowest rates in the
industry, and I have discounts from them for various things such as
having my home insurance and mortgage with them, having had military
service, a good payment history, and having had insurance with them for
30 years; I also have a discount for being a good driver, and one called
"Vehicle Experience Discount", which means that they have had fewer
claims and/or less cost per claim for the Prius than for other cars.
The discounts total $176.30.

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Bill - 04 Nov 2007 13:37 GMT

> In article <Y8JWi.367621$6L.120...@fe03.news.easynews.com>,
>
[quoted text clipped - 19 lines]
> --
> Support the troops: Bring them home ASAP.

I wonder if the higher insurance rates for the Prius might relate to
driver age. When one is looking at retirement and reduced income with
increasing gasoline prices going to a hybrid seems a good idea.

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jorthstorm@jorthstorm.net - 09 Nov 2007 22:21 GMT

>Why is the Toyota Prius expensive to insure? While contemplating a new car
>purchase this fact has come to my attention (this is in the USA, I think
[quoted text clipped - 42 lines]
>aware of this? Anyone think of any aspects of the car that would lead it
>to have much higher rates?

My cousin the insurance agent gave me an answer that probably fits
your case. Insurance companies go by two major factors when
determining rates. First is how much it costs to repair the 'average'
accident damage, and 2nd is how badly passengers are injured in
accidents. He told me that over 50% of Prius involved in what would be
a moderate collision in another vehicle are total losses because
repair costs exceed book value of the vehicle. Any damage to the
$3,000 battery pack requires replacing it. Even if it's not directly
hit in the collision cell terminals crack and cause problems. Add in
substatntial body damage and it's cheaper to junk it.

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