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Why doesn't my insurance cost more?
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Wyndham
Posts: 2,614 Forumite
I've worked in the insurance industry in the past, but admit this one has me rather confused!
We've currently got a 10 year old Vectra, 150000 miles, very rusty, old, past it, probably worth less than £500.... and we're trading it in for an Astra which is less than a year old and has done 9000 miles and is costing £9000. So I rang my insurer who told me that for the one month left on the insurance there was no extra charge for the new car, and the premium for the next year differs by about £10 on last year.
OK, I'm happy about it. But I can't really understand why. Why do I not have to pay more to insure a much newer car, worth much more money?
I'd appreciate any help!
We've currently got a 10 year old Vectra, 150000 miles, very rusty, old, past it, probably worth less than £500.... and we're trading it in for an Astra which is less than a year old and has done 9000 miles and is costing £9000. So I rang my insurer who told me that for the one month left on the insurance there was no extra charge for the new car, and the premium for the next year differs by about £10 on last year.
OK, I'm happy about it. But I can't really understand why. Why do I not have to pay more to insure a much newer car, worth much more money?
I'd appreciate any help!
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Comments
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Why do I not have to pay more to insure a much newer car, worth much more money?
Well the major risk that the insurer faces is 3rd party claims.
It's extreme but consider the case of Gary Hart who drove his vehicle onto a train track and the resulting costs were £30 million.
Your £9K for the car is not only small in value but it is also a known cost.
This means they can re-insure elsewhere for the risk that they know about.
It's the unknown and huge costs they are worried about not your £9K car.0 -
OK, I'm happy about it. But I can't really understand why. Why do I not have to pay more to insure a much newer car, worth much more money?
I'd appreciate any help!
Newer cars have improved safety features. So if you are in an accident you are less likely to be injured as badly.
Newer cars have better theft prevention features. Making it harder for someone to break into your car to drive it or steal the radio, plus if a young joy-rider took your car they are more likely to be stopped by the police in your new car than your old one as younger drivers are more likely to be insured on older cars.I'm not cynical I'm realistic
(If a link I give opens pop ups I won't know I don't use windows)0 -
Don't question it!!! Just be happy you've changed something and not been charged a fortune for the priviledge...0
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