New technology such as automated emergency braking is designed to improve vehicle safety by reducing the risk of crashes. Research indicates that Advanced Driver Assistance Systems (ADAS) can decrease the likelihood of a crash by up to 50%. However, these safety features may lead to higher insurance rates due to their expensive repair costs.
According to Bankrate Insurance Analyst Shannon Martin, the high cost of repairing these advanced safety features can sometimes outweigh the discounts offered on car insurance policies. “Lots of times when you go to the car lot, the dealer might say, ‘Oh, this might save you lots of money on car insurance because it’s the safest car available,’ and while it will make you safer and you might get more discounts for having safety features, the cost of repairing these type of devices can sometimes outweigh the discount you might see on your car insurance policy,” Martin explained.
How to Balance Safety and Insurance Costs
To benefit from safety technology without significantly increasing insurance rates, Martin advises consumers to research before visiting a dealership. “The best piece of advice I have for people looking to buy a new car is to go to the dealer’s website before you go down there in person,” she said. “You can pull the full VIN number of the cars and the different trim levels and get quotes with your insurance carrier.”
By doing so, buyers can identify vehicles with safety features that fit within their insurance budget. Martin suggests opting for standard safety features rather than deluxe packages, as the latter can be costly to repair. For instance, a basic rearview backup camera can be a cost-effective safety feature that may save money on car insurance, unlike luxury versions integrated into entertainment systems.
While the cost of repairing advanced safety features may decrease as they become more widespread, for now, it’s essential to be mindful of their potential impact on insurance costs.
