Insuring compact cars
Even with cash for clunkers is over, consumers are trading in their gas guzzling trucks and cars for fuel efficient small cars and hybrids. But there are some warnings that come with insuring a compact car.
The Insurance Research Council (IRC) announced a finding that the cost of auto injury claims on smaller vehicles is higher than similar claims on heavy ones. Probably no secret there.
Small car injury claims are climbing
The Insurance Research Council's study shows the “average auto injury claim payment in accidents involving lighter-weight vehicles was 14.3 percent greater than the average payment in accidents involving heavy vehicles.” With more consumers buying small cars in response to high gas prices, the average cost of injury claims is climbing.
"The impact of higher gas prices on drivers, accident severity, and insurance costs is anything but simple," says IRC’s senior vice president Elizabeth A. Sprinkel. "Our findings indicate that higher average claim costs associated with lighter vehicles have the potential to offset, to some extent, whatever beneficial effects might occur from less driving. It's far too early to know how all these effects together will influence insurance claim costs."
Small car medical claims
The Insurance Research Council analyzed 9,140 medical or personal injury protection (PIP) payment claims made in 2007. The study did not include claims from fatalities or permanent disabilities. The study took the average total accident claim payments for vehicles weighing less than 2,771 pounds and compared them to claim payments made to owners of vehicles weighing over 3,726 pounds or more. The study did not include claims from fatalities or permanent disabilities.
The study results are that the average payment for lighter weight vehicle claims was 14.3 percent ($5,554) over the heavy cars ($4,859).
The Insurance Research Council found 46 percent of claimants in heavy vehicles lost no work time following their accidents vs. only 38 percent of claimants in small or light weight cars. Claimants injured in small vehicles were over 10 percent more likely to be hospitalized.
Some companies offer up to 10% discount
Accidents with smaller cars result in more serious injuries. Some things money cannot buy. Still, some companies (Like Travelers) do offer up to 10% discount, for hybird car drivers. And the fuel savings is not up for debate. Lastly, replacement parts on smaller cars may be mass produced and cheaper, depending on the car. Your classic security vs. economy situation. PHP ERROR: Cannot execute query9.