Insurance rates...?

2000alhVW

Veteran Member
Joined
Aug 30, 2018
Location
Silver Spring, MD
TDI
2000 Golf
So I took the next step at being educated in considering a later model TDI, and I didn't like my quickie insurance rates.

I did a few online quotes at my current company, Geico, and a new quote at Progressive. As the car will most likely be financed, it's the first time I'm ever going to have full coverage. It makes quite a large difference, as I've enjoyed not paying for years.

The numbers were a bit unappealing. The lowest quote I saw is $150/month for so-so full coverage insurance. $1000 deductible, mediocre limits, etc.

Although I am younger (turning 24 in 2 weeks), my record is spotless - tickets and accidents. I'm not happy to see this, as it puts quite the damper on things. a $250-$300 car payment is certainly manageable for me, and is a responsible expense, but an extra 40-60% being spent on insurance is a lot to swallow.

Other things: I've been a driver for 8 years, no incidents. I've had my own insurance policy for ~2 years now. I live in a mostly rural area. I currently pay ~$110/month for 3 vehicles - all older, and liability only. Kinda off-putting since my best friend (same age) is paying ~$110/month for a $30k sports car in the city...

Any tips here?
 

oilhammer

Certified Volkswagen Nut & Vendor
Joined
Dec 11, 2001
Location
outside St Louis, MO
TDI
There are just too many to list....
I hear ya. I generally pay cash for my cars, and have only carried full coverage a few times. I have it now on my Sprinter, even though it is paid for, mainly because I cannot go out and replace it if something happened to it and it was a total loss. After a souring experience with State Farm when I was younger than you are now, I have learned to shop around.

Years ago I signed up with an insurance broker, and HE shops around and gets me a pretty good rate. Of course, being a homeowner, married, etc. as well as being much older and in a very low cost of living area helps.

My advice would be think long and hard before financing a car at your age. You really should be working towards something else, like real estate, higher education if necessary, even planting seeds for retirement. If you DO decide to finance a car, save up as much as you can to put as much down as you can and get it paid off as quickly as you can. I would carry the minimum the lien holder requires for insurance, and if possible get the highest deductible as this can drastically reduce your payments. This lessens the rates because the insurance company knows you will be less likely to use the policy for every last little thing. However some lien holders will not allow too high of a deductible, you'll need to check with them first.

And above all else, live below your means. Do not stretch your budget to the point that the payments to purchase and insure this shiny new(ish) car make it so you cannot afford a set of tires when they require replacement. That mistake happens all too often.
 

740GLE

Top Post Dawg
Joined
Aug 19, 2009
Location
NH
TDI
2015 Passat SEL, 2017 Alltrack SE; BB 2010 Sedan Man; 2012 Passat,
When you turn 25, the insurance bean counters have determined you've sowed your wild oats enough to give you a break. See if you adjust your age what you'd be paying next year.

Also, I'd recommenced paying in 6 months in full, they usually give you another discount, ($50?).

What's your profession? Sometimes they give you a break if you say you work in a "safe job"
 

2000alhVW

Veteran Member
Joined
Aug 30, 2018
Location
Silver Spring, MD
TDI
2000 Golf
Thanks for the replies.
Yep, I'm on board with everything said here. I understand it. I'm pretty swift of this stuff.
I've heard the golden age of 25 for a while, also heard it as "there's 3 large drops in insurance for men 21, 25, and getting married/buying a house".

I simply find it unfortunate that it's so cost ineffective for an adult (I'm almost 24. Most of my peers graduated from college 2-3 years ago, and some of them even have salaries in the $70k+ range) to buy reliable transportation.
When I was 16, and they quoted me $3000/yr for a 1994 Chevy Silverado, it made sense - they don't want to insure me, but if I pay their jackpot price it's a win-win.
But now, it's just annoying.

Toying around with Progressive's online quote, I got it down to $115/month with the bare minimum. $2000 deductibles, no roadside assistance (do people actually use that stuff?), no rental allowance, etc.
Still kinda crazy for a car with KBB of ~$13,000...

As for waiting as long as possible to finance a car, I hear ya, but I've considered some more complex variables. I've always been smart with money, and driven exclusively beaters for ~7 years. I slowly slid my way up to decent vehicles, but bought them outright. I've definitely seen peers get drowned in debt financing something at 18 years old, or even 22, 23 years old. Not for me.
My best friend and I were on the same wavelength there. Then he graduated college (holding around $18k debt), and got his dream job with a $55k salary. So he treated himself to a new 2017 Focus ST. Both as a treat, but also if he was late for a single day of training, he would lose his job, so a dead-reliable vehicle was motivation as well.
I understand that, and I mostly agree with it. Unfortunately, that particular model depreciates horribly.
I wanted something similar, but not quite as 'severe'. I figured a $15k 2015 Golf was a responsible option. I figure depreciation (at this point) is moderate, good MPG, reliable, comfortable. Something that can carry me into my early professional career, and I can grow with.
I also want to build credit, and I've been toying financing something for a while. My credit score is 'high' but it's weak due to little credit history.
 
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cleaver

Veteran Member
Joined
May 8, 2006
Location
Berwick, Nova Scotia
TDI
None - did own '01 and '02 Jetta TDI
This is from Canada so not sure if it works there as it does here. When I was shopping for insurance I noticed a strange occurrence a few years ago. A Pontiac Sunfire was more expensive to insure than similar aged Jetta TDI. The reasoning (from the insurance broker) was that there are more claims made on the Sunfire model and therefore it costs the insurance industry more. Try another model car and see how your insurance changes. My daughter's car was purchased based on the cheapest for car payments and insurance payments included. No sense in having a cheap car payments if your insurance payments are through the roof.
 

cleaver

Veteran Member
Joined
May 8, 2006
Location
Berwick, Nova Scotia
TDI
None - did own '01 and '02 Jetta TDI
...and I have been told that the discounts for males 21, 25, married thing is now long gone....so they say.
 

oilhammer

Certified Volkswagen Nut & Vendor
Joined
Dec 11, 2001
Location
outside St Louis, MO
TDI
There are just too many to list....
Well the car I drive every day, which is paid for, is almost 19 years old, and I would gladly place it in the "dead reliable" category. ;)

Do not assume you MUST finance something to drive something reliable. I resurrected a tooefed 2.slo 2001 Jetta with 190k miles on it about five years ago. Sold it for $2800 to my brother in law. He drives it every day. In five years it has needed scheduled PM, one set of tires, and one [power] window regulator. His method is, he saves about $300/mo (started out at only about $200/mo) towards a new car "some day". This old Jetta will allow him to walk into the dealer and buy a nice new car with cash...and the longer this Jetta lasts (it is nearly at 275k miles now), the more expensive car he'll be able to buy. Maybe even two.:)
 

kjclow

Top Post Dawg
Joined
Apr 26, 2003
Location
Charlotte, NC
TDI
2010 JSW TDI silver and black. 2017 Ram Ecodiesel dark red with brown and beige interior.
A few thing that you may have missed:
Combination policies. Do you have renter's insurance, which you should unless you're living at home. See if that same companies offers a discount on both renter's and auto policies. That could net you out about 20% (10% discount on both). Make sure when looking at other policies to check out the multi-policy discounts too.

Although you say you're in a rural area, Silver Springs is still close to Baltimore/DC area so you are paying higher insurance just due to population density. Your age and area can be extreme killer on the insurance costs. Yes, it will drop when you turn 25, but not that much. My daughter just turned 25 and no appreciable drop in her coverage.

As an ultimate fall back, see if your parents can include you and the newer car on their insurance. I know I can cover my youngest daughter until she gets married.

Think about the deductible really hard. Do you have $2000 sitting in the bank in case something happens and you need to get the car back on the road?

How far do you drive from home to work? There are discounts for low mile commutes. You could also list the newer car as a secondary or recreational use vehicle. Not sure which is cheaper.
 

740GLE

Top Post Dawg
Joined
Aug 19, 2009
Location
NH
TDI
2015 Passat SEL, 2017 Alltrack SE; BB 2010 Sedan Man; 2012 Passat,
I agree with oilhammer, newish doesn't mean reliable.

Probably the biggest mistake in my 20's after graduating with my first real job was over extending myself when I bough my 2010 TDI. I kept thinking to myself, I'll make more money next year with raises and I'll conserve more cash the next month, sadly only one of those came true. I was paying close to $400/mo for a car payment and about $800 for 6 months of insurance, then tack on ~$500 for registration, then I just had to spend $500 on winter tires and then yadda yadda yadda, boom way over extended. It took quite a while to work my way back to in the black. I was able to pay off the car in 4 years vs the 5 year note I signed.

Before the Jetta, I was previously driving a 14 yr old Volvo 960 wagon i bought from ebay, I had about $2300 of repairs (timing belt every 30K sucks, yeah that's not a typo!) into it but I also put on 40-60K "trouble free" miles and was a 230K when it was traded in, so i went from about $100/month in operating costs to about $6-700.

Also the zip that you claim you live also plays a bigger role in rates, in the city will be higher than the countryside, crime rates and break ins factor into rates.

I also have progressive and was able to use their snapshot, I can commute to work via cycling, so I timed it right so i started the snapshot (6mo) program when I would be cycling 1-3 times a week.
 

IndigoBlueWagon

TDIClub Enthusiast, Principal IDParts, Vendor , w/
Joined
Aug 16, 2004
Location
South of Boston
TDI
'97 Passat, '99.5 Golf, '02 Jetta Wagon, '15 GSW
I like the idea of keeping what you have and saving what would have been the cost of a new car and insurance until you can buy one with cash.
My kids (all of them older than you :eek:) all have cars, and only one has a loan (lease actually). My sons both drive '02 TDIs that we take care of and have proven very reliable. Maybe not beautiful as they age, but neither of them care about that. And my younger son is very proud to drive a Golf with a 2" lift and 370K miles on it.

My daughter leased a '18 Civic a couple months ago. She's in law school, has no spare cash, is totally car ignorant, and lives in LA so I can't easily help her out if she has a problem. The lease is cheap and she expects to buy the car out at the end. By then she'll be working and able to do that. So it made sense, even though it wouldn't be my first choice.

And rates going down at age 25 is a thing of the past, at least in this state. They drop after you've been driving 3 years, but don't change much after that.

Finally, I think full coverage on my '15 GSW is about $1,100 year for full coverage, and I have pretty high liability limits. Not bad, in my opinion, but my Wagon is $400 w/o collision and theft.
 
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Lightflyer1

Top Post Dawg
Joined
Sep 13, 2005
Location
Round Rock, Texas
TDI
2015 Beetle tdi dsg
I started my daughter in a $400 car and told her to save car payments just like she was making them. She drove that for 2 1/2 years and sold it for $1700. She took that money and her $1700 and bought another better car for cash and did the same thing again. She just recently bought a 2015 Passat TDI buyback car for $15k cash. All the while still putting the "car payment" away for later use. With judicias shopping and and some discipline staying out of car slavery debt is possible and still have a nice car to drive. I taught my daughters that being in debt is like slavery. No use working your whole life just for someone elses gain. Not being financed allows you to carry just liability which is far cheaper than full coverage. If you total it you just start over.
 

JM Popaleetus

Veteran Member
Joined
Mar 15, 2010
Location
Connecticut
TDI
Signature.
There is so much that factors into car insurance that it’s hard to guess why rates are higher than others. For example, Hyundai’s carry a higher premium just because my insurance’s bean counters said so.

I’m 28, have had four accidents (only one my fault) and live in a high-risk driving area. My insurance rate for full coverage that I don’t sweat anything is only $1250/year. I personally don’t think $100/mo is that bad all things considered.
 
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