Can Fuel Efficient And Hybrid Cars Reduce Your Auto Insurance?

More and more people are investing in fuel efficient and hybrid cars, which can provide lower emissions and better mileages than other vehicles. From compact but powerful cars like the MINI Countryman and the Mini Hatch to the BMW 3 Series, to electric cars like the Chevrolet Volt and hybrids such as the Toyota Prius, more brands are offering improved fuel efficiency.

However, can a fuel efficient or hybrid car result in lower premiums on your auto insurance?

In terms of immediate benefits, a car with less emissions and a smaller or optimized engine that doesn’t burn through as much fuel can be attractive to insurance companies; hybrid cars particularly don’t tend to encourage rapid acceleration or high speed driving on the road, with insurers consequently viewing them as less of a risk.

A driver that invests in a more fuel efficient car may also be interpreted by an insurer as generally being less of a risk taker.

Some insurers will also provide discounts on hybrids and fuel efficient cars if their owners can demonstrate that they’re making a commitment to reducing their emissions and overall costs when on the road. Some green car insurance schemes include offsetting some of the cost of your premium against CO2 emissions – insurers will offer lower premiums if this offset is smaller, meaning that a fuel efficient or hybrid car can be cheaper to insure than one with a poor mileage and high emissions.

Other green car insurers may also market themselves to drivers as making a contribution on your behalf to eco conscious schemes; this might include payments towards low carbon schemes or even just planting trees or investing in recycling schemes.

Moreover, if you can demonstrate that you’re taking shorter journeys, or that you’re using your mileage responsibly, insurers can take off a percentage from your premiums.

Driving a hybrid car can also help you to lower your premiums by being less of a theft risk. For example, the Toyota Prius has a reputation as one of the least stolen cars in the United States, and one that is recovered the most rapidly through GPS tracking.

From 2008 to 2010, only 1 in 606 Priuses were stolen, compared to 1 in 78 of other marques.

However, there is a downside to driving fuel efficient cars, and particularly hybrids. Quieter engines can make some cars more of a risk for collisions and accidents if other drivers and pedestrians can’t hear them, while fuel efficient cars can result in larger than average mileages, even with savings for drivers.

Hybrid cars are also generally more expensive to buy up front, and have parts that can be more difficult to replace; this can particularly be the case for electric cars that have batteries.

So, can you actually reduce your auto insurance premiums by investing in a more fuel efficient or a car hybrid car? Savings are available through specialist car insurers, but with various provisions and schemes – discounts may also not outweigh the investment you make in a car upfront.

Remember, though, that you can save money elsewhere through exemption from road tax and congestion charges. If driving in a city, and if your mileage is low, you might be better placed to receive a discount if you avoid accidents and can build up a no claims discount.

Mechanic and car restoration fanatic, Rob regularly blogs about a wide range of automotive topics, from insurance to green energy.

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