The words "economical" and "auto insurance" probably shouldn't be used together, in particular when comparison shopping for the lowest insurance prices for college graduates. Let's open your eyes to some of the factors that impact car insurance premiums, and find a way to cut the cost of your next policy.
The vehicle driven is one of the largest factors when comparing the best cheap car insurance for college graduates. Vehicles with lower acceleration and performance, a plethora of safety features, or a positive history of liability claims will cost quite a bit less to insure than fast, unsafe models.
The data below illustrates auto insurance rates for a handful of the most affordable automobiles to buy coverage for.
|Make, Model, and Trim Level||Estimated Cost for Full Coverage|
|Honda CR-V LX 2WD||$1,024|
|Honda Accord LX 4-Dr Sedan||$1,122|
|Chevrolet Silverado LS Regular Cab 4WD||$1,132|
|Ford F-150 XLT Crew Cab 2WD||$1,145|
|Dodge Grand Caravan SE||$1,151|
|Toyota Tacoma 4WD||$1,145|
|Ford Escape XLS 2WD||$1,156|
|Toyota Camry LE||$1,211|
|Toyota RAV4 Limited 4WD||$1,221|
|Dodge Ram 3500 Crew Cab Laramie 2WD||$1,233|
|Ford Focus SES 4-Dr Sedan||$1,252|
|Hyundai Elantra SE 4-Dr Sedan||$1,275|
|Toyota Corolla XRS||$1,297|
|Chevrolet Silverado 2500HD LTZ Crew Cab 4WD||$1,302|
|GMC Sierra SLE Regular Cab 4WD||$1,297|
|Ford Explorer XLT AWD||$1,304|
|Jeep Wrangler Unlimited Sahara 4WD 4-Dr||$1,313|
|GMC Sierra 3500HD SLE Extended Cab 2WD||$1,320|
|Chevrolet Impala LT||$1,327|
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Above prices assume single male driver age 30, no speeding tickets, no at-fault accidents, $1,000 deductibles, and Texas minimum liability limits. Discounts applied include multi-vehicle, homeowner, safe-driver, multi-policy, and claim-free. Prices do not factor in the specific area where the vehicle is garaged which can decrease or increase coverage rates considerably.
Looking at the data, we can presume that cars like the Honda CR-V, Honda Accord, Chevrolet Silverado, Ford F-150, and Dodge Grand Caravan will be some of the most budget-friendly vehicles to insure for college grads.
For college grads, one of the big considerations that aid in calculating insurance cost is where you call home in Texas. Areas with a lot of weather claims or more people like McAllen, Houston, and Garland tend to have more expensive auto insurance rates, whereas areas with lower vehicle theft rates and fewer weather claims can boast about having cheaper rates.
The next table rates the highest-priced areas in Texas for college graduates to buy auto insurance in.
|Rank||City||Average Per Year|
|Quote Best Rates Go|
Rate quotes are estimated as specific location information can alter prices substantially.
Full coverage versus liability only rates
Reducing the cost of car insurance is important to the majority of people, and one of the quickest ways to reduce the cost of insurance for college graduates in Texas is to only buy liability insurance. The example below illustrates the difference between auto insurance rates with full physical damage coverage compared to only buying liability only. The premiums assume no tickets, no at-fault accidents, $250 deductibles, single status, and no other discounts are factored in.
If we average the cost for all age groups, physical damage coverage costs an extra $2,671 per year more than just buying liability only. That proposes the question when is the right time to remove full coverage. There isn't a written rule of when to exclude full coverage on your policy, but there is a general guideline. If the annual cost of coverage is 10% or more of any settlement you would receive from your insurance company, then you might consider buying liability only.
For example, let's assume your vehicle's settlement value is $5,500 and you have $1,000 physical damage deductibles. If your vehicle is severely damaged, the most you would get paid by your company is $4,500 after paying your policy deductible. If it's costing you more than $450 annually for comprehensive and collision coverage, then you may need to consider dropping full coverage.
The information below demonstrates how choosing different deductibles can influence insurance costs when getting quotes for cheap insurance for college graduates in Texas. The premiums assume a married male driver, full coverage, and no discounts are applied.
The chart above illustrates that a 40-year-old driver could lower their policy premium by $372 a year by switching from a $100 deductible to a $500 deductible, or save $560 by choosing a $1,000 deductible. Young drivers, like the 20-year-old example, could drop their prices $1,240 every year just by using higher deductibles. If you do decide to increase your deductibles, it will be necessary to have enough in a savings account to allow you to cover the extra out-of-pocket expense, which is the primary disadvantage of high deductibles.
Reckless driving habits raise car insurance rates
The easiest method to earn good car insurance premiums in Texas for college grads is to pay attention while driving and avoid at-fault accidents and violations. The chart below shows how traffic citations and accident claims can affect car insurance costs for each different age category. Data assumes a married female driver, comprehensive and collision coverage, $100 deductibles, and no other discounts are factored in.
In the prior example, the average cost of an auto insurance policy in Texas per year with no accidents and a clean driving record is $2,242. Get two speeding tickets and the average cost hikes up to $3,202, an increase of $960 each year. Then add one accident along with the two speeding tickets and the annual cost of car insurance for college graduates in Texas jumps again to an average of $4,187. That's an increase of $1,945, or $162 per month, just for being a little careless behind the wheel!
Why it's important to shop around
Texas car insurance rates are impacted by many factors that may substantially change the cost of having a policy. Simply improving your credit, buying higher coverage limits, or getting a ticket for careless driving may cause policy rate changes that can cause some rates to be cheaper than competitors. Not only may things change on your end, but insurance companies modify pricing multiple times each year in order to protect their financial rating. An extended period of higher than normal claims can cause additional price hikes, while a better loss history can cause cheaper Texas car insurance rates.
The data below shows the cheapest car insurance in Texas for a 40-year-old male driver with no accidents, a clean driving record, and solid credit. Based on his personal profile, Travelers may have the cheapest car insurance rates in Texas at $1,010 per year. This is $894 less than the average premium paid by Texas drivers of $1,904. USAA, Texas Farm Bureau, Germania Mutual, and Esurance are the remainder of the best Texas auto insurance companies.
Now we will give the driver from the first set of rates a claim, a lower credit rating, and a stop sign violation. Since each auto insurer uses their own calculation to establish rates, comparing quotes could result in a slightly different list of affordable Texas car insurance companies as shown below.
State Farm now has the cheapest insurance rate in Texas with Mercury, USAA, Safe Auto, and Nationwide completing the list. This demonstrates why Texas drivers need to take the time to shop around to get cheap car insurance rates for college graduates.
Rates are made up of many factors and change dramatically, so the cheapest company the last time you checked may now be quite expensive.