What you should know about buying a used vehicle and how to insure it

Buying a vehicle new isn’t always the best option for your finances. After all, cars begin to depreciate in value the minute you drive them off the dealership’s lot. Used vehicles, on the other hand, not only save you money at the initial purchase, but they can also mean lower auto insurance costs in Edmonton. The value of your vehicle determines the insurance rates. A new vehicle is seen as more valuable which means a higher cost to the insurance companies should that vehicle be involved in a wreck. But unlike newer vehicles, used vehicles require a bit more research before deciding on that final purchase. On this blog, HDF Insurance has gathered information on what you should know before buying a used vehicle and how to insure it.

Avoid the clunkers: what you can do to avoid bad used cars

As with any large purchase, it’s always important to do your research. When considering a used car, be sure to:

Get the vehicle’s history report – This will tell you the vehicle’s past owners, its maintenance history, accident history, airbag deployment information, and much more.

Take the car to a private mechanic – Get the unbiased opinion of a private mechanic. They can tell you if there are any unseen issues with the vehicle.

Make sure it hasn’t been recalled – If a vehicle has been recalled by its manufacturer, it may have a safety defect or doesn’t comply with current standards.

Check what consumer agencies are saying – Consumer protection agencies have the best interests of shoppers in mind. They will alert consumers of potential problems with certain vehicles. In fact, sometimes they can flag issues that don’t make it into the vehicle’s history report or show up in inspections. For example, consumer agencies have warned that some vehicles coming from the United States to Canada may have flood damage from hurricane Harvey and other disasters. While the imported vehicles may appear in good condition, the flood damage is likely to cause problems that appear months or even years later.

Best types of used vehicles to purchase

Not all used vehicles are the same. Just because the minivan sitting in your neighbour’s front lawn seems like a great deal doesn’t mean it won’t turn out to be a money pit. Here are the best types of used vehicles to purchase:

Certified preowned vehicles – A certified preowned (CPO) is usually a late-model vehicle that has been inspected, refurbished, and certified for quality. These vehicles often come with a warranty or special financing.

Previously leased cars – More than likely, a previously leased car is relatively new with low mileage. Leased vehicles usually have to be kept in top condition during their lease term so you’re likely getting a used vehicle that has a great maintenance record.

Former rental cars – Similar to previously leased vehicles, former rental cars are well maintained and kept clean. Rental companies are also likely to have records of the maintenance to ensure it’s been taken care of during its time as a rental.

What kind of car insurance in Edmonton does a used car need?

Car insurance is a must in Edmonton in order to drive legally. Basic coverage is mandatory in Alberta and consists of two types: third party liability and accident benefits.

Third party liability or personal liability and property damage insurance covers you if you are involved in a car accident that causes damage to someone’s property or causes injury or death.

Accident benefits protect you and your passengers in the event of injury or death no matter if you are at fault for the accident or not. This insurance will cover everything from medical care and rehabilitation to funeral expenses and death benefits. Accident benefits will also protect if you are in an accident with an uninsured driver.

There are additional options to consider including collision, comprehensive, and specific perils coverage. Knowing which options are right for your used vehicle can be tricky. The independent insurance brokers at HDF Insurance can help you find the right car insurance in Edmonton to fit your needs by comparing insurance company rates and services.

Finding cheap car insurance in Edmonton for your used vehicle

Insurance costs can vary, but finding cheap car insurance in Edmonton for your used vehicle doesn’t have to be hard. New cars tend to have higher rates because of their high market value and the pricey repairs needed to fix them in case of an accident. Used vehicles on the other hand tend to have cheaper insurance, but some factors can raise rates so it’s important to weigh your options. Some things that can potentially raise your rates include, but are not limited to:

  • Vehicle age
  • Make of the vehicle
  • The main use of the vehicle
  • Your location
  • Your driving history

Some other factors that may affect your rates include:

New Drivers: If your used vehicle is going to be driven by a new driver, your rates are going to be higher than average. The lack of driving experience makes new drivers more likely than other drivers to get into an accident and your premiums will show that.

Inspections: Additionally, most insurance companies require used vehicles that are 12 years or older to have an inspection before they can insure it. The inspection can also factor into the insurance’s cost.

Modifications: Whether you’re adding tinted windows or upgrading your stereo system, modifications you make to your vehicle can also determine your auto insurance rates. In worst case scenarios, the new modifications could void your pre-existing insurance policy altogether. Insurance companies set rates based on a number of factors including whether the accessories are factory-built and tested. Modifications could increase accident risk by jeopardizing the factory-built conditions. That’s why it’s important to talk to your insurance company before making any modifications to your vehicle.

Contact HDF Insurance to learn more about insuring used vehicles

Book your appointment with one of the brokers at HDF Insurance to discuss auto insurance for your used vehicles.