Car Insurance for Compact Cars

By Desiree Baughman
Desiree maintains insurance licensure in 46 states, and by combining years of experience as a writer and insurance professional, she delivers information consumers can easily relate to and understand. A graduate of Sweet Briar College with a diverse writing portfolio, she regularly serves as an expert source and commentator for respected outlets like CBS Money, Bankrate, and Ragan.com.

Car Insurance for Compact Cars

A car owner might reasonably assume that the more expensive a car is, the higher the insurance rate. After all, replacing or repairing a Mercedes would certainly cost more than a Honda Civic, so the insurance rate should reflect that, right?

Yes and no. According to a collection of recent annual reports, expensive vehicles are the most expensive to insure, but the less expensive vehicles aren’t always the cheapest on the list in terms of insurance coverage.

What Does Compact Car Insurance Entail?

Car insurance for compact cars can include a number of different mandatory and optional endorsements, such as:

  • Liability coverage
  • Underinsured/uninsured motorist coverage
  • Collision and comprehensive coverage
  • Gap insurance
  • Medical coverage

These coverage types are generally available for any vehicle type, but can actually turn out to be less expensive for, say, a pickup truck or minivan than a Honda Civic.

Why Are My Insurance Rates So High?

There are a variety of factors that an insurance company will take into account when determining your insurance rate:

  • Your location: Compact car owners tend to live in urban areas where more cars are present, and therefore the likelihood of an accident or fender bender is increased.
  • Compact cars, such as the Honda Civic, are among the most stolen vehicles in America.
  • Compact cars, given their light weight and small size, offer less protection to passengers and are also more easily damaged a pickup truck, SUV or minivan.

Maintaining Appropriate Coverage

When in doubt, it’s always a good idea to invest in a higher-than-state-mandatory liability coverage amount. A good rule of thumb is to opt for liability insurance that at least matches the value of your assets, just in case you ever find yourself in court and held “at fault” for a tragic vehicle accident.

Apart from underinsured or uninsured coverage, which is mandatory in some states (and is always a good idea, given the number of Americans who don’t carry required coverage), the other options are up to you. Brand new vehicles will benefit from collision insurance and possibly comprehensive insurance, whereas older vehicles can do without. Gap insurance can be valuable for those driving an expensive vehicle or a leased vehicle, but will be of little to no value for inexpensive cars, and useless for those that are fully paid off. Even medical coverage car insurance might not be necessary, depending on what’s provided under your health insurance policy.

When in doubt, seek the advice of insurance professionals. Go through all your policies with them. That way you will be able to fill in any gaps where coverage is lacking and also save money by eliminating any unnecessary coverage.