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Help, I'm a new driver and insurance costs are giving me a heart attack

bulletproofbulletproof Posts: 5
edited June 2016 in General
Hello I'm a new driver and I just got my license last month, I want to buy a car and start driving now but it seems insurance is holding me back. I'm 22 years old and recently got a quote from GEICO for bare minimum insurance for a 2003 Buick LeSabre and they want about 6,000$ FOR SIX MONTHS, I can't afford that.. if I take off even more coverage its down to about 4,000$ which is still too expensive.. How is a guy supposed to live when he has to pay that much for car insurance? I can't afford my bills with rates like that..


  • andre1969andre1969 Posts: 23,487
    like they're trying to make you squeal like a pig. Any reason WHY your quote is so high? Do you have a bad driving record or anything like that?

    My roommate has Geico, and I think they're ripping him to the tune of around $2300 a year, for full coverage on a '98 Chevy Tracker. About the best thing I can suggest you to do is call around. Also, don't screw around with those automated internet quotes that Geico and Progressive, and others offer. Call an office and speak to a live agent!

    I could see you getting screwed for insurance if you were like 16 or 17, but by the time you're 22, if you have a good driving record, your insurance should have taken a big drop. For example, way back in 1987 when I first got insurance, liability-only, but in my own name (not on my parents' policy), my premium was $1361 that first year. The second year it dropped to $1280, then to something like $1079. It actually got down to $703 a year when I was 21, and would have gone to $653 the next year, but then I got 2 points on my record, and that shot me back up to around $969.

    Your insurance should drop once you turn 25, and I think it drops again when you hit 30.

    Something's screwy though, that they'd want to charge you $12,000 a year for a LeSabre!
  • badtoybadtoy Posts: 368
    If you call an agent, they'll look around for the best rates (doesn't cost you any more, they get paid by commission from the insurance company).

    There are a lot of insurance companies who specialize in low(er) rates for high-risk or young drivers. You might also want to check with your local body shops to see who they recommend (if you're carying collision, you don't want a company that stiffs the body shops).

    Also, if the car is worth less than a couple grand, collision and comprehensive aren't worth it -- just buy the minimum legal liability coverage you need.
  • I have nothing on my record, I am 22 but just got my license last month, I'm not sure how much a difference it makes at what age you recieve your license, but even still 4,000-6,000 for six months still seems crazy. I figured the LeSabre would be good for me since it was the cheapest to insure and most safest car in 2002-03. $1361 seems like a good figure that you got.. I guess I'll have to call up and find out that way.
  • andre1969andre1969 Posts: 23,487
    sticking you with a higher rate because you just got your license, and you don't have an insurance history, but still, $8-12K a year is just phenomenal! My Dad recently got a car and insurance in his own name, after not being insured since like 1984. They stuck him with a higher rate because he didn't have an insurance history, but said that after a year it'll go down.

    Does Erie Insurance Group offer coverage in your area? If they do, you might want to give them a call. I switched from Allstate to Erie back in early 2000 (I was 29 at the time) and the premium for my '00 Intrepid, which I had just bought a few months before, dropped from $900 a year to about $550-560. It's going to depend on where you live though. I'm in a fairly low-risk area, but my uncle, who only lives about 9 miles away, was in a "bad" enough area that Erie couldn't give him a better deal than his Allstate agent.

    Erie can also be kind of picky about what they'll insure. For instance, my roommate tried to go with them, but they wouldn't insure him at all because they said his '98 Tracker was too risky of a vehicle. A LeSabre is probably about as low-risk as it gets, though!
  • badtoybadtoy Posts: 368
    is if you're leasing. If you are, you are often required to carry far more liability than would ordinarily be required (this is to protect the lease-holder).
  • swschradswschrad Posts: 2,171
    I agree, call an independent agent and shop around. littler outfits with names like Pigslop Farmers Beneficial Mutual Insurance of Northeastern Tennesee, if they have a good A.M. Best rating so they will be around to pay if you have a claim, are going to have the lowest advertising costs and lower overhead than the guys with three tv commercials an hour. they will charge you less.

    that lesabre should be very affordable to insure. but you ARE going to pay more until you are 25, guaranteed, probably twice what an old fart like me will pay, because enough kids are laughing it up with a carful while driving, and arguing with fixed objects that just lurched out of the dark at them. the fixed objects always win. and so do the insurance companies. drive carefully with respect for the power you wield, and it will come down.
  • pluto5pluto5 Posts: 618
    New drivers can usually avoid sky high rates if they stay on their parents policy. When you move out, you have to get your own policy.
  • davv62davv62 Posts: 76
    bulletproof -

    I saw on your profile that you live in New York. Is that New York City? New York state in general, and the city in particular, has experienced huge increases in insurance rates brought on by rampant fraud which the state legislature refuses to correct because of the trial lawyer lobby. Still, the rates you quote are astronomical.

    You will find wide variations among insurance companies in rates. Certain companies specialize in a certain type of driver in certain areas, and if you're not the type they want, they quote really high rates as a way of telling you they don't want your business.

    So I would definitely shop around. I noticed one question always asked is if you have had insurance for the past 6 months. You could inquire as to whether the rate would go down after you are able to answer "yes" to that question.

    Inexperienced operators, defined as driving less than 3 years, also pay more. And you are under 25 and, I presume, a male. So you're getting it from all angles.

    I have a couple of suggestions if possible:

    -If you live in the city, you could try to register and insure the car at an address outside the city. Even the close-in suburbs have radically lower insurance rates than the boroughs.

    -If you live with your parents and they are willing, you could insure the car under their name, and list yourself as an occasional driver. This will save a lot of money. If your parents are worried about liability and they own a home, they could get an umbrella policy through their homeowner's insurance for a lot less money than the car insurance would cost you.

    I hope you can work something out.
  • jlawrence01jlawrence01 Posts: 1,828
    >>-If you live in the city, you could try to register and insure the car at an address outside the city. Even the close-in suburbs have radically lower insurance rates than the boroughs.<<

    There is a phrase for the practice. It is called INSURANCE FRAUD.

    It is legal to move to a suburb with lower insurance rates. For example, if you live in Dearborn, MI, you pay lower rates than if you live in the city of Detroit.

    However, if you live in Detroit and claim that you live in Dearborn to get a lower rate, that is misrepresentation,

    Had a friend who was caught and it resulted in the insurer not paying a claim.
  • swschradswschrad Posts: 2,171
    you can also be in the doo deeply if you register your car in rural new jersey, say, and they catch ya. you are in trouble in NY for sure, and potentially for making false statements in NJ if you say you're a piney when you live in flatbush.
  • andre1969andre1969 Posts: 23,487
    to call the Nationwide agent that insures my Grandmom's house (she also has a life insurance policy on me that might be just enough to bury me), and this agent is going to be able to give my roommate a much better deal than what he had through Geico.

    My roommate had been paying $2300 a year, but when the last bill came in the mail, it dropped a bit to $175 a month, which comes out to $2100 a year. He also went a bit risky though, dropping his coverage limits in order to get the bill down.

    The Nationwide guy though, was able to get him something like $133 a month for the same coverage as Geico, or $145 a month for increased coverage, which in this day and age of sue-happy people, is a good thing to have!

    That's still over $1700 a year, which to me is still awfully high, but it beat the heck out of what he was paying!
  • samnoesamnoe Posts: 731
    When I leased my new minivan, my insurance rate came up to $4,100! I was using Travelers for my old car (minimum coverage) and paid about $1,800 per year, but I never dreamed that full coverage will cost me THAT much - more than $4,000!!!

    I ended the year, and started shopping around. I had license for just over 2 years, and was 24 years, a male, in NY state... (that's why they charged me so much!)

    So I called many companies asking for a quote. The lowest I got was at "Kamper Direct" (they already changed names for 'Unitrin'). I got a price for $2,200.

    Wow! what a difference! one company asking $4,100, and the other one just $2,200! That learned me to always shop around.

    A year after, I had already 3 years license, I was over 25, with an excellent driving record, and it dropped for about $1,800 per year. Still a lot, but almost the price I was paying for minimum coverage when I start driving.

    So the only way is: shop around, or ask a insurance agent to give you the best price.
  • KCRamKCRam Mt. Arlington NJPosts: 3,516
    Hi bullet

    Your new license is indeed helping jack you rate quotes, but I would like to ask one question... why a 2003 Buick LeSabre? Your insurance quotes would plummet if you looked for a nice 4-5 year old economy car like a Chevy Prizm/Toyota Corolla. The worst way to start your driving/insurance history is to start with a 1 year old full-size near-luxury car.

    Smart Shopper/FWI/Wagons Message Boards
  • mirthmirth Posts: 1,212
    ...try AAA - they seem to have pretty good rates. Also, if any of your relatives are in the military (or were in the military), you could get USAA which seems to consistently have the lowest rates.
  • automan227automan227 Posts: 118
    Not sure if this really helps any, but I pay close to $3k/yr for insurance on my son, who drives an '01 Taurus. He is 17, no accidents, convictions, or pullovers for anything.

    I think part of the problem is that we have three cars...a Ford Excursion, Taurus, and my Audi A8, and I think my Audi is whats making my rates go through the roof with him.

    Is there any truth to that logic?
    Any idea when this rate will go down?

  • ms_mayorms_mayor Posts: 113
    You hit it right...the Audi is probably what's driving the rate so high.

    Normally, young drivers or drivers considered high risk in a household are assigned rates based on the most expensive car on the policy. The theory is that even though you say that driver is only using the 'cheap' car, there's always the chance they're behind the wheel of the expensive car.
  • ghuletghulet Posts: 2,628
    Is your son covered on the A8 and Excursion? If so (and if he doesn't drive them), I'd have him removed from coverage on those. It's usually cheaper to buy a kid a separate car and insurance (which you've done) than to have them covered on expensive and/or sporty vehicle.
  • automan227automan227 Posts: 118
    My son does drive both of them occasionally. The ironic thing is, that the insurance for him on the Excursion (where he is listed as the primary driver), is much less then the other two (thus why I made him the primary driver). Luckily, the lease is up on the A8 in a few months, and this will be a non-issue.

  • The Audi A8 a nice car and a pretty good deal for the money, of course one has to overlook the occasional quality problem with it, but I have found that the Audi A8 is actually a fairly expensive vehicle to insure. One of the main reasons for this is this car has a ton of aluminum in it and is very expensive to repair when it is in an accident.

    Smart Shoppers / FWI Message Boards
  • automan227automan227 Posts: 118
    I picked up this '98 A8 used in the summer of 2001 on a 3 year lease (got a really great deal on it). The only real reason that I am getting rid of it (aside from the high insurance) is that since as soon as the lease is up, it will be out of warranty (80,000 miles) and I have owned 4 other Audi's prior to this and I know how expensive they are to maintain.

    On top of that, the transmission died on it about 8000 miles ago, and had to be replaced. If I had not had the lease-term warranty on it, I would have been out almost $14,000 to replace it. So keeping that in mind, I will be moving on at the end of the summer.

    Another opportunity to go car shopping :)

  • hewalhewal Posts: 2
    wow. I would like to know how much your car cost . The first time i got an insurence it was $595.00 for 6 months.
      My advise is, the best thing to do is to shop around. Dont be suprised if you find an insurance under $1000 for 6 months.
      Right now i am paying $650 for 6 months. i did shop around and i got almost $2000.00 offer from few other insurance. So as you can see i came down from $2000 to $650. Good Luck.
  • prophet2prophet2 Posts: 372
    Beware of this tactic. Insurance companies have so-called "assigned risk" subsidiaries that they steer "less-desirable" risks to. Premiums can be 40-80% higher or more for the same coverage.

    In our jurisdiction, you cannot be penalized for age, gender, marital status, length of driving experience, or occupation. The only legal rating criteria are driving records, accidents, type of vehicle, number of vehicles, and type of driving (pleasure, t/f work, business). So, if you have a "clean" record, you should get reasonable rates, right?

    WRONG! You may be steered to second and third-tier subsidiaries if you don't watch it. Here is an example for which I have documented proof.

    A serviceman bought a used car and since this was his first vehicle, he needed new insurance. He went to a State Farm agent and got a quote for liability-only at $676 for six months. He actually needed full coverage as the car was financed. He came to me and I got him full coverage at $550 ($405 liability-only). Why the difference, you might ask?

    First, State Farm did not quote him from STATE FARM MUTUAL, which would have been $375. The $676 (80% higher) was from STATE FARM FIRE. STATE FARM GENERAL, used for DUI applicants, would have been in the $1900-2000 area.

    To the consumer, STATE FARM is STATE FARM, a major national writer. Many will just accept the higher rate without a second thought.

    Why was he steered this way? In all likelihood because STATE FARM did not consider GIs as prime insureds. So, they're offered coverage at a higher premium than may be justified. It's like being penalized before being convicted or even accused of a "crime." But, this tactic is legal. The applicant has been offered a policy and is free to refuse it.

    Note that at $405 liability-only, I didn't have the lowest rate. But, I got him what he needed.

    A little later, after I had submitted $20K of auto premium (30-35 applicants) in a single month, I got a call requesting that I no longer solicit military business as my book was "out-of-balance." Incidentally, I received ZERO commissions and NONE of these insureds ever filed a claim during my time with that agency.
  • jlawrence01jlawrence01 Posts: 1,828
    I am going to make ONE point. In the age of the internet, if you don't get multiple price quotes on car insurance, you deserve to pay the higher rates you are.

    Four weeks ago. at 5 am on a Saturday, I went on-line and within about 90 minutes had nine different quotes with little effort. Like usual, my current insurer - which offers my employer group auto rates - was again the lowest. And they offer good service.

    I would also recommend taking your current declaration sheets and faxing it to a couple of independents and seeing what they can offer.
  • prophet2prophet2 Posts: 372
    Get a quote on the vehicle you're planning to buy to avoid unpleasant surprises about the insurance cost. Or, if you're considering several makes and models, check on the rates of each - the info may help you decide what to buy.
  • steine13steine13 Posts: 2,695
    I do that every time I think about buying a new car.
    The differnce can be staggering, and there are some big surprises.
  • I'm a 47 year old female buying a car in NJ for the first time since the 80s. I gave up my car and my insurance when I moved to NYC in '86. Now I'm living in Jersey and need wheels again. Is the fact that I don't have any current insurance going to work against me? I have a spotless driving record. From what I am reading, the fact that I don't have current insurance puts me in a higher risk category, is that right?
  • Hi newbie_buyer. I am sorry to say that the fact that you have not had insurance since the 80's will definitely count against you when you try to get insurance now. You will end up paying more than someone who is already insured, especially in New Jersey which is notorious for its high auto insurance rates.

    Smart Shoppers Message Board
  • tornado25tornado25 Posts: 279
    I'd actually say "it depends". Depends on proactive your agent is, how hardcore the underwriting rules are, if the underwriter got divorce papers just before your app lands on her desk, etc.

    I know here that when we encounter a "no insurance" issue, we find out why. More often than not, we can figure out if there is valid reason or if it's really the "driving without insurance". In your situation, we would probably be cool with it with proof of purchase, etc. (Helps show you didn't trade something in, a big clue you were driving without insurance). In your case, living in NYC is a very good reason for not having insurance--i.e., it seems right that you wouldn't have a car and thus, no insurance (not that living and driving in NYC is good reason for not having insurance).

    Now, for the caveat. I work in a small town in WI. You have the misfortune of living in a car insurance hell (no dig on NJ, it may be very nice, but it's a very hard market for auto insurance). The underwriters may be looking for ANY reason not to take the business or alternatively, any reason the law will allow (because there aren't many) to charge a higher rate. Thus, they may not be interested in the "why you don't have insurance" versus the simple fact you don't have it.

    I would consult a number of agencies/companies and explain your situation. If you find one that seems to understand your situation and will work around it, I would go with it. I'd suggest my company, but we are either withdrawing from the state or at least in a holding pattern, depending on the political breeze.
  • stickguystickguy Posts: 32,330
    you won't find anyone in NJ (myself included) that will be offended by referring to it as "insurance hell", since it is. Well, maybe the insurance secretary (if we have one), but I'm sure that person is in witness protection by now.

    2019 Acura TLX A-spec 4 cyl. (mine), and 2013 Acura RDX AWD (wife's)

  • tornado25tornado25 Posts: 279
    Yes, you do have an Insurance Commissioner, although in NJ, I THINK insurance is regulated by the Department of Banking and Commerce or some such nonsensical thing. She's always babbling about much better things are now that a new set of laws passed. I think her name is Holly Bakke (?).

    The craziest law? The excess profits law. If a company made more than 6% profit per year (they do look at a rolling period of 3 years or something, though) they had to refund premiums to insureds. I mean, it must be a seriously impossible place to do business. Just try finding people from 3 years ago that you owe a refund, but are no longer insured with you. It's some mind-numbing stuff.
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