Auto insurance industry takes the gas money savings from small car owners

Many drivers of smaller automobiles may be smiling about their fuel cost savings, but their smiles may soon fade when they start to realize that the auto insurance industry is taking a share of the money that they aren't paying for gasoline. Let it not be said that smaller automobiles don't come with a cost trade off.

An examination of automobile insurance premiums from The Wall Street Journal reveals that the nature of smaller autos makes them justifiably more expensive to insure. For some smaller cars, such as some of the new hybrid models, replacement parts can be difficult to obtain, and labor costs are sometimes higher than for conventional autos. Additionally, hybrid cars can often take longer to repair.

Hybrids in the News

    The BMW Concept 7 Series active hybrid car is seen on the back of a camera display at the Paris Auto Show, in Paris, Wednesday, Oct. 15, 2008. (AP Photo/Remy de la Mauviniere)

    AP

    People are seen looking at the BMW Concept 7 Series active hybrid car at the Paris Auto Show, in Paris, Wednesday, Oct. 15, 2008. (AP Photo/Remy de la Mauviniere)

    AP

    SHENZHEN, CHINA - OCTOBER 14: (CHINA OUT) Visitors view a F3DM electric vehicle and its model at 2008 China High-tech Fair (CHTF) on October 14, 2008 in Shenzhen of Guangdong Province, China. BYD F3DM, which has been claimed as China's first mass-produced electric vehicle by BYD Auto, is a gasoline-electric hybrid plug-in vehicle, using a small gasoline combustion engine to charge the car's battery. When fully charged, it can run as far as 100 to 110 kilometers by electricity. BYD planned to launch F3DM hybrid by the end of this year in Shenzhen. (Photo by China Photos/Getty Images)

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    SHENZHEN, CHINA - OCTOBER 14: (CHINA OUT) Visitors view a F3DM electric vehicle and its model at 2008 China High-tech Fair (CHTF) on October 14, 2008 in Shenzhen of Guangdong Province, China. BYD F3DM, which has been claimed as China's first mass-produced electric vehicle by BYD Auto, is a gasoline-electric hybrid plug-in vehicle, using a small gasoline combustion engine to charge the car's battery. When fully charged, it can run as far as 100 to 110 kilometers by electricity. BYD planned to launch F3DM hybrid by the end of this year in Shenzhen. (Photo by China Photos/Getty Images)

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    SHENZHEN, CHINA - OCTOBER 14: (CHINA OUT) A model poses to promote a BYD F0 at 2008 China High-tech Fair (CHTF) on October 14, 2008 in Shenzhen of Guangdong Province, China. F0, a traditional gasoline-fueled car, will be replaced by a Dual Mode (DM) plug-in hybrid in the future. BYD Auto unveiled on October 12 the F3DM, which has been claimed as China's first mass-produced electric vehicle by BYD. F3DM is a gasoline-electric hybrid plug-in vehicle, using a small gasoline combustion engine to charge the car's battery. When fully charged, it can run as far as 100 to 110 kilometers by electricity. BYD planned to launch F3DM hybrid by the end of this year in Shenzhen. (Photo by China Photos/Getty Images)

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    SHENZHEN, CHINA - OCTOBER 14: (CHINA OUT) A model pets a child as she poses to promote the BYD autos at 2008 China High-tech Fair (CHTF) on October 14, 2008 in Shenzhen of Guangdong Province, China. BYD Auto unveiled on October 12 the F3DM, which has been claimed as China's first mass-produced electric vehicle by BYD. F3DM is a gasoline-electric hybrid plug-in vehicle, using a small gasoline combustion engine to charge the car's battery. When fully charged, it can run as far as 100 to 110 kilometers by electricity. BYD planned to launch F3DM hybrid by the end of this year in Shenzhen. (Photo by China Photos/Getty Images)

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    SHENZHEN, CHINA - OCTOBER 14: (CHINA OUT) Visitors view a F3DM electric vehicle at 2008 China High-tech Fair (CHTF) on October 14, 2008 in Shenzhen of Guangdong Province, China. BYD F3DM, which has been claimed as China's first mass-produced electric vehicle by BYD Auto, is a gasoline-electric hybrid plug-in vehicle, using a small gasoline combustion engine to charge the car's battery. When fully charged, it can run as far as 100 to 110 kilometers by electricity. BYD planned to launch F3DM hybrid by the end of this year in Shenzhen. (Photo by China Photos/Getty Images)

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    SHENZHEN, CHINA - OCTOBER 14: (CHINA OUT) Visitors view a car model depicting the structure of F3DM electric vehicle at 2008 China High-tech Fair (CHTF) on October 14, 2008 in Shenzhen of Guangdong Province, China. BYD F3DM, which has been claimed as China's first mass-produced electric vehicle by BYD Auto, is a gasoline-electric hybrid plug-in vehicle, using a small gasoline combustion engine to charge the car's battery. When fully charged, it can run as far as 100 to 110 kilometers by electricity. BYD planned to launch F3DM hybrid by the end of this year in Shenzhen. (Photo by China Photos/Getty Images)

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    SHENZHEN, CHINA - OCTOBER 14: (CHINA OUT) The Household Charge Port and Quick Charge Port are seen on a F3DM electric vehicle at 2008 China High-tech Fair (CHTF) on October 14, 2008 in Shenzhen of Guangdong Province, China. BYD F3DM, which has been claimed as China's first mass-produced electric vehicle by BYD Auto, is a gasoline-electric hybrid plug-in vehicle, using a small gasoline combustion engine to charge the car's battery. When fully charged, it can run as far as 100 to 110 kilometers by electricity. BYD planned to launch F3DM hybrid by the end of this year in Shenzhen. (Photo by China Photos/Getty Images)

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    SYDNEY, AUSTRALIA - OCTOBER 09: The Toyota Hybrid Supra HV-R is unveiled during the Australian International Motorshow at the Sydney Convention & Exhibition Centre October 9, 2008 in Sydney, Australia. (Photo by Cameron Spencer/Getty Images)

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Karen Block, an independent insurance agent in Medford Wisconsin, indicates that the situation is quite basic and easy to understand. She stated: "Smaller cars have statistically higher repair costs." The Wall Street Journal article reports: "A recent study by the Highway Loss Data Institute, an affiliate of the IIHS, found that overall insurance costs for crash damage were higher for 11 of 12 hybrid cars and SUVs than for their gas-only counterparts."

While the owners of smaller cars may be paying higher costs to have their own cars repaired, it should be noted that their premiums for property damage liability may be lower. This is due to the fact that, when compared to larger vehicles in similar collisions, smaller cars tend to do less damage to the things they hit. There is concern however, that this condition may also mean that smaller cars offer their occupants a reduced level of crash protection, which is why I keep myself surrounded by a full sized Chevy pick-up truck, and keep my wife in her well built Jeep SUV.

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