Do Safer Cars Really Cost Less to Insure?

The Evolution of Vehicle Safety Ratings

Vehicle safety ratings didn’t always play such a central role in car buying or insurance pricing. Decades ago, safety testing was limited, and consumers had little standardized data to compare vehicles. That began to change in the late 20th century, as government agencies and independent organizations introduced crash-test programs.^[1]

In short, insurers don’t just look at whether a car is safe; they look at how that safety impacts the total cost of risk.

Safety Features That Can Lower Premiums

Not all safety features are created equal in the eyes of insurance companies. Some have a more direct and measurable impact on reducing claims, and those are the ones most likely to influence your premium.

Here are some features that often lead to insurance discounts or lower rates:

• Automatic emergency braking (AEB): Helps prevent rear-end collisions by applying brakes when a crash is imminent
• Adaptive cruise control: Maintains safe following distances on highways
• Lane departure warning and lane-keeping assist: Reduce the risk of drifting out of your lane
• Blind-spot monitoring: Alerts you to vehicles you might not see when changing lanes
• Electronic stability control (ESC): Helps prevent skidding and loss of control
• Anti-lock braking systems (ABS): Improves braking performance in emergencies
• Airbags (front, side, and curtain): Reduce injury severity in crashes

These features are especially valuable because they either prevent accidents or reduce the severity of injuries. Insurers often provide discounts for vehicles equipped with them, particularly when they come standard rather than as optional add-ons.

However, it’s worth noting that some high-tech features can increase repair costs. For example, sensors and cameras used in driver-assist systems can be expensive to replace, which may offset some of the premium savings.

Other Factors That Influence Premiums

While safety ratings are important, they’re just one piece of the puzzle. Insurance companies consider a wide range of factors when determining your premium, and sometimes these can outweigh the benefits of a high safety rating.

Key factors include:

• Driver profile: Age, driving history, and location all play a major role
• Vehicle type: Sports cars and luxury vehicles often cost more to insure
• Repair costs: Vehicles with expensive parts or specialized repairs can increase premiums
• Theft rates: Cars that are frequently stolen may carry higher insurance costs
• Usage: How often and how far you drive affects your level of risk
• Coverage choices: Higher limits and lower deductibles increase premiums
  
  

For example, a high-performance vehicle with excellent safety ratings may still cost more to insure than a modest sedan with average ratings. That’s because insurers are balancing multiple risk factors, not just safety.

This is why it’s important to look at the total cost of ownership when buying a vehicle. Insurance can be a significant ongoing expense, and safety ratings are just one of several variables that influence that cost.

How to Use Safety Ratings When Choosing a Car

If you’re in the market for a new or used vehicle, safety ratings can be a useful tool, not just for protecting yourself and your passengers, but also for managing insurance costs.

Finally, consider how long you plan to keep the vehicle. Investing in a safer car may result in slightly higher upfront costs, but it can pay off over time through lower insurance premiums and reduced risk of injury.