Wednesday, July 08, 2015


So yesterday I called our insurance carrier to remove the '06 Chrysler PT Cruiser from our policy and add the '10 Mercedes Benz ML350 to our policy.  It was pretty easy since I had the new vehicle's VIN handy and wanted exactly the same coverage.

Then came the shock...

The agent said our premium would go DOWN by $6.

"How could this be possible?" I asked.  "The Kelly Blue Book value of the new car is literally 10 times the value of the old car!"

As the agent explained, premiums are calculated in part by the frequency of claims submitted by make and model.  Apparently there are a lot more claims filed by PT Cruiser owners than by ML350 owners. 

Still, from a replacement value point of view it seemed impossible that our rate would go down by replacing a cheap car with a more expensive one, but the agent double-checked her calculations and confirmed the lower rate.

So, it costs less to insure this
2010 Mercedes Benz ML350
than it does this
2006 Chrysler PT Cruiser
I was totally floored but accepted the rate reduction.


Kelly Stern said...

Hey there... hope all is well... but insurance rates also have to do with the number of safety features, how much damage your car would do to another if you were to hit someone... but the insurance industry is all over the place when it comes to pricing... thus a good reason to shop around when buying new cars or homes... each company has a niche market they tune in to... glad you were able to save some money! Let me know if you have any questions about is my life now... hugz!!

anne marie in philly said...

^ listen to what the man sez ^

Biki Honko said...

Well, silly as it seems to us mere mortals who don't work in the insurance biz, a savings is deluxe plus, yeah? And hey he could use that money to run the car thru the car wash more often! A total win/win/win!

Anonymous said...

I had the same thing happen several months ago. What a surprise to find out the new car is cheaper to insure than the old one. (But a good surprise for a change.).


Ur-spo said...

My mother's side are mostly insurance agents. They have amazing data on risks. I am not surprised to hear this happened.

Anonymous said...

No rhyme or reason when it comes to insurance. If you don't mind my asking, how much did a five year old ML350 cost?