Luxury Car Insurance: Is it any different from other types of insurance?

Luxury car insurance rates are about 18% higher than regular car insurance. To affordable luxury car insurance rates, owners can get low mileage coverage, higher deductibles, or many more discounts. The best way to save is to compare luxury car insurance quotes.

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UPDATED: Mar 31, 2022

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Written By: Laura BerryReviewed By: Joel OhmanUPDATED: Mar 31, 2022Fact Checked

Here's What You Need to Know

  • Luxury cars cost about 18 percent more to insure than standard vehicles, so you should calculate the cost of coverage into your overall investment before you buy
  • Teens and other high-risk drivers should not drive luxury vehicles in order to avoid incredibly expensive rates
  • Choosing a higher deductible on your luxury auto insurance policy can significantly lower premiums

Luxury car insurance: Is it any different from other types of insurance?

Buying a luxury car is exciting; Not only are you getting a beautiful car, but other people are looking at you with envy. The question is, do you need specialty car insurance or will any old insurance policy do?

Luxury cars are different from any other type of car; they cost more to make, more goes into their engineering, and, of course, they cost a lot more to insure. The thing is, you aren’t going to need anything special when looking for luxury car insurance.

The overall rates for luxury cars will be higher than average because when you purchase a more expensive vehicle, you’re going to have to pay more to insure it. The insurance company is going to have to pay more in order to repair or replace your vehicle if you are the cause of an accident.

Affordable or cheap luxury car insurance costs aren’t out of reach. There are ways you can save on your luxury car insurance to help you reduce your overall costs.

Compare luxury car insurance rates now; enter your ZIP code above and get FREE luxury car insurance quotes from multiple insurers.

Are luxury vehicles more expensive to insure?

Where can you find cheap luxury car insurance is that offers full coverage? Who has the best rates on auto insurance?

No matter what type of vehicle you have, an insurance provider will look at a variety of factors to determine how much your auto insurance rates will be. These include your:

  • Driving history
  • Credit score
  • Commute length
  • Home city and ZIP code
  • Occupation

Auto insurance companies also look at the listed value of your vehicle. What car is the most expensive to insure?

Luxury cars are more expensive to insure. That’s because one factor in determining car insurance rates is the model of your vehicle.

You can often check the value of your vehicle on a site like Kelley Blue Book, but there’s one rule that’s always true:

The more expensive the vehicle is, the more expensive your car insurance will be.

Luxury vehicle insurance is very similar to ensuring other specialty cars, such as:

And it is generally more expensive than normal car insurance.

You can see average rates for classic car insurance per state in the table below.

Average Annual Classic Car Insurance Rates by State
StatesAverage Annual Comprehensive Insurance RatesAverage Annual Collision Insurance RatesAverage Annual Liability Insurance RatesAverage Annual Full Coverage Insurance Rates
New Hampshire$66.46$184.45$240.34$491.25
New Jersey$78.81$229.12$521.74$829.67
Rhode Island$79.31$246.91$455.88$782.10
North Carolina$81.65$176.15$215.65$473.45
New York$102.67$231.01$482.71$816.40
New Mexico$103.54$166.19$292.82$562.55
South Carolina$108.56$159.04$316.25$583.86
West Virginia$122.57$197.80$295.10$615.47
North Dakota$138.62$146.45$178.91$463.98
District of Columbia$139.94$281.20$377.29$798.44
South Dakota$154.87$125.15$180.13$460.15
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As you can see, rates vary wildly by the state. Classic car insurance rates in Idaho averaged $407.93/year, while rates in Louisiana are more than twice as much at around $843.22/year.

How can you save money on luxury car insurance?

Much like any other type of car insurance, maintaining a good driving record is an excellent way to keep your rates reasonable. If you already have a sketchy driving record, do your best to avoid further violations.

The longer you go without a ticket or a claim, the less expensive your insurance will be. You should see changes on your insurance every six months that you keep your record clean.

Here are some other ideas to keep your car insurance rates reasonable:

  • Don’t let your teen drive your luxury car! Teen drivers are simply bad news when it comes to car insurance rates and the quickest way to see your rates increase is by adding your 17-year-old child to your policy.
  • If you’re purchasing a luxury car for occasional driving, you should consider pay-as-you-go insurance or ask for a discount for low mileage driving.
    • While this won’t apply to everyone, if you’re only driving a few miles a week or month, you shouldn’t pay full price for your insurance because your overall risk has been reduced by your lack of driving.
  • You can also use a deductible to keep your costs down. While you don’t want to go crazy and try to get a $1,500 deductible, a $250 to $500 deductible can actually make a significant difference in your overall premiums.
    • If you can afford a luxury car, chances are you can go for a higher deductible.
  • Join a club for luxury car owners. Insurance companies often give discounts to luxury car drivers who join clubs because this shows that they have pride in their cars.

When you join a club, the insurance company believes you will drive more carefully because you really care about your vehicle more than the average car owner does.

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What type of luxury car insurance should you buy?

When you buy a luxury car, you’re purchasing a high-dollar vehicle. You’re going to want to have a high level of protection, even if you purchased your vehicle outright.

Your state’s minimum requirements for auto insurance — which you can find on the Insurance Information Institute’s website — will likely not be enough to cover the cost of insurance for your luxury vehicle if you have an accident.

Search the table below to find the minimum coverage requirements for your state.

Car Insurance Coverage Requirements by State
StatesCar Insurance
Minimum Liability
AlabamaBI & PD liability25/50/25
AlaskaBI & PD liability50/100/25
ArizonaBI & PD liability25/50/15 (2)
ArkansasBI & PD liability, PIP25/50/25
CaliforniaBI & PD liability15/30/5 (3)
ColoradoBI &PD liability25/50/15
ConnecticutBI & PD liability, UM, UIM25/50/25
DelawareBI PD liability, PIP25/50/10
D.C.BI & PD liability, UM25/50/10
FloridaPD liability, PIP10/20/10 (4)
GeorgiaBI & PD liability25/50/25
HawaiiBI & PD liability, PIP20/40/10
IdahoBI & PD liability25/50/15
IllinoisBI & PD liability, UM, UIM25/50/20
IndianaBI & PD liability25/50/25
IowaBI & PD liability20/40/15
KansasBI & PD liability, PIP25/50/25
KentuckyBI & PD liability, PIP, UM, UIM25/50/25 (4)
LouisianaBI & PD liability15/30/25
MaineBI & PD liability, UM, UIM, Medpay50/100/25 (5)
MarylandBI & PD Liability, PIP, UM, UIM30/60/15
MassachusettsBI & PD liability, PIP20/40/5
MichiganBI & PD liability, PIP20/40/10
MinnesotaBI & PD liability, PIP, UM, UIM30/60/10
MississippiBI & PD liability25/50/25
MissouriBI & PD liability, UM25/50/25
MontanaBI & PD liability25/50/20
NebraskaBI & PD liability, UM, UIM25/50/25
NevadaBI & PD liability25/50/20
New HampshireFR only25/50/25
New JerseyBI & PD liability, PIP, UM, UIM15/30/5 (6)
New MexicoBI & PD liability25/50/10
New YorkBI & PD liability, PIP, UM, UIM25/50/10 (7)
North CarolinaBI & PD liability, UM, UIM30/60/25
North DakotaBI & PD liability, PIP, UM, UIM25/50/25
OhioBI & PD liability25/50/25
OklahomaBI & PD liability25/50/25
OregonBI & PD liability, PIP, UM, UIM25/50/20
PennsylvaniaBI & PD liability, PIP15/30/5
Rhode IslandBI & PD liability25/50/25
South CarolinaBI & PD liability, UM25/50/25
South DakotaBI & PD liability, UM, UIM25/50/25
TennesseeBI & PD liability25/50/15 (4)
TexasBI & PD liability, PIP30/60/25
UtahBI & PD liability, PIP25/65/15 (4)
VermontBI & PD liability, UM, UIM25/50/10
VirginiaBI & PD liability (8), UM, UIM25/50/20
WashingtonBI & PD liability25/50/10
West VirginiaBI & PD liability, UM, UIM25/50/25
WisconsinBI & PD liability, UM, Medpay25/50/10
WyomingBI & PD liability25/50/20
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When you purchase liability insurance, you should consider the worst-case scenario and purchase car insurance to cover that situation.

In addition, you want to ensure that you can replace your vehicle if it’s a total loss after an accident — that’s where collision insurance comes in.

Collision insurance is designed especially for replacing or repairing your vehicle if it’s damaged in an accident; no other type of insurance will cover the cost of repairs for your vehicle.

The other type of insurance that you will need is comprehensive insurance. Comprehensive coverage will pay for damages related to incidents like fire, severe weather, and theft/vandalism.

Comprehensive and collision coverage are going to be the most expensive options for your policy.

Here’s a short video discussing the difference between the two.

If it’s available in your state, you should also consider GAP insurance if you’ve financed your vehicle. When you have an accident, the insurance company pays the market value of your vehicle, not the replacement value or your financing costs.

GAP insurance covers the difference between what your car is worth and what you actually owe. This type of policy could end up saving you a lot of money if you have a devastating accident.

High-End Car Insurance Companies

If your vehicle is a special import, kit, or supercar, insurance companies may not cover it at the level you need. Special car insurance companies (or luxury car insurance companies) exist for these situations.

Companies that provide these services include:

  • Hagerty Insurance
  • Grundy Insurance
  • Heacock Classic

You might be able to get Geico car insurance for your exotic car, but if the price point is high, you may want to consider a specialty car insurer.

These special car insurance companies work with you to determine an agreed-upon value for how much your car is worth.

This video from Heacock Classic discusses how insurers use agreed-upon value versus stated value.

Rather than going by the Kelley Blue Book value, they look at more factors to determine if your vehicle should be insured for a higher amount.

Comparison Shopping for Luxury Car Insurance

When you purchased your luxury car, did you buy the first one you saw or did you shop around and try to get the best deal? Chances are you went online and checked every dealership that sold the car that you were considering buying to see who had the best deal.

When you shop for car insurance, you should do the same thing. You need to check with different companies to see who has the best rates for you. Remember that prices everywhere will vary; luxury car insurance costs in Australia, India, and the U.K. will be different from the U.S.

Fortunately, this process is a lot easier than it was when you were looking for the perfect car; you can find the perfect luxury car insurance without having to look at multiple sites.

The easiest way to accomplish this is to use our free quote tool. You’ll be able to compare the rates from several different quality companies in a single location.

If you wouldn’t purchase the first luxury car you saw, why would you purchase the first insurance policy you get a quote from?

Find the lowest luxury car insurance rates for you by entering your ZIP code into our free tool below.

Editorial Guidelines: We are a free online resource for anyone interested in learning more about auto insurance. Our goal is to be an objective, third-party resource for everything auto insurance related. We update our site regularly, and all content is reviewed by auto insurance experts.

A former insurance producer, Laura understands that education is key when it comes to buying insurance. She has happily dedicated many hours to helping her clients understand how the insurance marketplace works so they can find the best car, home, and life insurance products for their needs.

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Written by Laura Berry
Former Insurance Agent Laura Berry

Joel Ohman is the CEO of a private equity backed digital media company. He is a CERTIFIED FINANCIAL PLANNER™, author, angel investor, and serial entrepreneur who loves creating new things, whether books or businesses. He has also previously served as the founder and resident CFP® of a national insurance agency, Real Time Health Quotes. He has an MBA from the University of South Florida. Jo...

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Reviewed by Joel Ohman
Founder & CFP® Joel Ohman

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