Anonymous asked in Business & FinanceInsurance · 4 weeks ago

Why is car insurance so hard to get but required ?

Speaking for a 20 year old with no liable parents to put me into their insurance. But everyone is over 300 . It’s crazy and unrealistic for people who aren’t millionaires. I work..have apartment ..and I need a car but can’t afford insurance.!  Anyone knows why it’s so high ? What places might be reasonable in from PA.

14 Answers

  • 2 weeks ago

    Actually, if you're talking about $300 a month, it is not so crazy. When I bought my first car, it was with the understanding that I was on my own for the insurance, I could not go under my parents' policy. The cost of that on a 7-year old car with no collision coverage, just full glass and basic liability, was $55 every month, payable yearly. My first year insurance cost more than twice what I paid for the car.

    Because of inflation, what cost $55 then will cost $319 today. So insurance for a newly-insured driver is really no more expensive for you than it was back then. I was earning a little over $2 an hour then. What are you earning?

  • Flower
    Lv 7
    3 weeks ago

    Do you mean $300 a month? You can get an older used car to bring your insurance rate down. Insurance rates are also different in different neighborhoods. Those that are prone to crime will be higher rates. When you turn 25 it will drop. You could find a friend to put your car in their name and get insurance in their name with you as an authorized driver. Thats not honest but its an idea. Have you tried several insurance companies? I found that the AAA was cheaper.

  • 4 weeks ago

    On top of being 20...if you've never had insurance before, you are high risk.  

    A car is a luxury, sorry, thats just reality.  Not everyone gets a car, thats not how life isnt fair.  

    There are ways to reduce your insurance costs:

    - Cheap car that doesnt need full coverage

    - Lower limits

    - Minimal usage

    Sorry if this isnt the answer you wanted to hear.  Good luck, life isnt easy...but keep your head up and you'll get through this. 

  • 4 weeks ago

    Because when there is a car accident, it often has to pay out tens of thousands of dollars for medical bills, injuries, lost wages, etc., not even including the cost of fixing the cars. And drivers who are only 20 years old have a lot of accidents.

    If they really only want 300-400 a month from all 20 year olds, then they'd be losing money on 20 year olds on average. Just to break even, without any profit, they would have to charge some 20 year olds closer to 1000 a month.

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  • Judy
    Lv 7
    4 weeks ago

    Insurance rates for 20 year olds are very high because they have so many accidents. Rates vary a lot based on the model of car, so choosing a car with low rates could help you. good luck.

  • Anonymous
    4 weeks ago

    The trick is to have the car insured in someone else's name, (that will require them to have their name on the the title at least as co owners) typically your parents and you end up "borrowing" your own car, then you don't need insurance at all, you can just pay your parents whatever they have to pay for this additional car, 

    There are always cheaper alternatives just sometimes require some cooperation and trust.

    You only need insurance on the car, you yourself don't need to be insured, if you do the above way even if you ever get pulled over, you are just borrowing a car.

  • 4 weeks ago

    Owning a car and not having it insured is illegal.  You are risking about a $2,000 fine, and if you can't afford that, expect to go to jail when you don't pay.  $300 is CHEAP CHEAP CHEAP.  If you can't afford that, then you can't afford a car.  Sell it and take public transportation.  When you have worked a while and received raises and have saved some money, THEN consider buying a car.

  • 4 weeks ago

    The premium is calculated according to assessed risk. 20 year-olds (especially males) are usually more likely to get into accidents (statistics -- actuary tables, to be precise -- show that this is so). So full insurance is more expensive,

    But the premium goes down with larger excess riders or by taking only third party insurance (paying for the other car(s) involved), or with less expensive replacement costs or a dozen other riders that can be inserted in the policy. You need to talk with the insurance broker to see just what you can get -- different insurance companies can have different options that can be inserted, so a broker dealing with more than one insurance company can get you a better deal that you'd get going straight to single companies.

  • John
    Lv 7
    4 weeks ago

    I don't recall the number - you could search for it if you want. Something like 60% of accidents involve people under the age of 25. And that's less than 60% of the population. Just a statistic..... Maybe my number is off but the essence is true - young people have the most crashes. When you hit 25 it will go down a bunch. Don't buy any Mustangs at your age either.

  • Anonymous
    4 weeks ago

    At 20 you are a high risk driver.   You are likely to cost the insurance company money, therefore they charge you more.

    Consider a motorcycle or scooter if you can't afford car insurance.   It's more dangerous, but insurance is much, much cheaper because the damage you can do to someone else or their property is usually much less than if you were in a car or truck.

    You could also consider carrying liability only - which means you're only covered for the damage you to do someone else, but not the damage to your own self or property if you're at fault.  

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