Wednesday 19th of December 2018

Get an Insurance Break for Driving a Hybrid

As if astronomical gas prices and tough economic times weren’t reason enough to purchase a hybrid, now there’s one more incentive: insurance discounts. As of February 2006, Traveler’s Auto Insurance has offered a discount on premiums for drivers of hybrid vehicles. Traveler’s is the first insurer to do so, and other carriers are expected to follow suit.

Why Hybrid Drivers Save

According to statistical data, drivers of hybrid vehicles tend to be less of a claims risk than other drivers. Drivers tend to be between the ages of 41-60 and married, and they are driven by an equal number of men and women. This demographic has one of the lowest collision rates, which is why at least one insurer has decided to reward owners with breaks on premiums. Anytime a driver or a vehicle lessens an insurance carrier’s risk, the company responds with lower premiums. In Traveler’s case, they also want to modernize their business to serve the booming market and attract new business.

Save Big by Switching

You might be able to qualify for a premium discount of up to 10% by driving a hybrid. This is in addition the following savings:

  • Fuel costs. The ever popular Toyota Prius gets a whopping 48 mpg during city driving, giving it an annual estimated fuel cost of $1211. If you currently drive an SUV, a Dodge Durango, for example, you are getting just 13 mpg, with an estimated annual fuel cost of $3722.
  • Tax breaks. As these vehicles grow more popular, the IRS is giving less substantial tax breaks to those who drive them. The tax break for Prius drivers is now down to only $787.50. However, you might get a larger break if you buy another model. For instance, certain GM hybrid vehicles might qualify for a tax deduction of $250-$1,300.

Word of Caution

A widespread panic about the economy and the price of oil has driven the stampede for hybrids. We’re now at the point that hybrids are selling at a premium, which means now is probably not the best time to purchase one. Multiple manufacturers have hybrids in the works now that will be coming out in 2010-2011, and these hybrids will have better technology than the existing models. You might want to wait until you have a wider selection and the market is more competitive.