Is Insuring a “Green Car” More Expensive Than a Regular Car?

In today’s world, there may not be a more recognizable example of the “going green” movement than green cars and alternatively fueled vehicles. As the world evolves into more sustainable ways of thinking and living, auto manufacturers have stepped up and are releasing even cleaner vehicle technologies like hybrid systems, alternative fuels, and fully-electric power plants.

One question you might ask yourself is, “What happens to my auto insurance if I buy a green car? Is it any different than car insurance for that gas-powered car I’ve also been looking at?” Read on to find out more.

Do you own a “green” car? What makes a vehicle “green” anyway?

The term “green” is simply another term for “eco-friendly,” and can be applied to nearly any new technology that puts sustainability and environmental consciousness front and center. They come in all shapes and sizes, but some common characteristics of green vehicles include zero emissions, hybrid blends of electric and gasoline power plants, high fuel efficiency, alternative fuels like hydrogen, ethanol, or biodiesel, and the increasingly popular fully-electric vehicle.

Will your auto insurance rate be higher or lower with a green car?

One of the most attractive elements of green cars is the potentially significant cost savings regarding fuel. Doubling or tripling your miles-per-gallon, or switching out from gasoline entirely, is not only great for your wallet, but it can have substantial environmental benefits as well.

However, there is an unfortunate downside to these types of vehicles: Auto insurance costs more than if you were insuring a traditional vehicle. According to Nerd Wallet, insurance premiums for green vehicles can be some 20 percent higher on average. That number can vary drastically depending on a number of factors, but on the whole, car insurance is indeed more expensive.

Why so much more? The generally higher overall valuation of these types of cars plays a role, as does their specialized service needs and unique parts. Some good news — there are auto insurance companies that offer up to a 10 percent discount for leasing or owning a green car, so be sure to look for that when comparing policies!

Don’t be discouraged from saving the environment, just be aware

Green cars certainly come with exciting benefits, but there are also a few things to keep in mind that could influence your decision. Outside of increased insurance premiums, green vehicles generally make less noise while driving than their gasoline-powered counterparts, meaning pedestrians are less likely to hear them, so the risk of a potential accident goes up. According to the National Highway Traffic Safety Administration, green vehicles are involved in more pedestrian collisions than traditional ones.

And, because your average green vehicle tends to be physically smaller, they end up suffering greater damage in an accident. Another thing to consider is the “newness” of a vehicle’s technology. Particularly with electric cars and their cutting-edge tech, there’s still an element of unknown about how those systems will function under the stress of everyday driving.

With that being said, this isn’t meant to dissuade anyone from buying that cool hybrid or slick new electric car they’ve been thinking of. Sure, there are a few extra details to consider over buying a traditional car, but none should be a discouragement.

The future of transportation

It’s a real possibility that green vehicles and the exciting new technology they bring to the road is going to play a significant role in the future of transportation. There are numerous benefits to owning a green car, such as the money that may be saved on fuel. And, like any new technology, costs associated with green vehicles will come down over time as they become more common and the supporting infrastructure more effective.

When it comes to insuring your car of the future, there are several important things to keep in mind — slightly higher premiums being one of them — but a little research and working with reputable companies will make the entire process easier and cheaper. That’s a win for you, and for the green car movement.