Foreign cars are not always more expensive to insure, but they often cost more than domestic cars depending on the brand, model, and repair costs. Insurance companies do not raise rates just because a car is foreign. They look at how much the car costs to fix, how easy parts are to find, safety ratings, theft risk, and how often claims happen for that model.
In general, foreign luxury cars like BMW, Mercedes Benz, Audi, and Lexus are more expensive to insure. These vehicles use advanced technology, specialized parts, and higher labor costs, which makes repairs more costly after an accident. Higher replacement value also increases comprehensive and collision premiums. Because of this, insurers see them as higher risk to insure.
On the other hand, many foreign economy cars such as Toyota, Honda, Hyundai, and Mazda are often cheaper to insure than domestic vehicles. These cars are known for reliability, strong safety features, and affordable parts. They also tend to have lower theft rates and repair costs, which helps keep insurance premiums lower.
Your personal details matter just as much as the car. Your age, driving record, location, mileage, and coverage choices can raise or lower your rate more than whether the car is foreign or domestic.
Foreign cars are only more expensive to insure when they are luxury or high performance models. Many foreign brands actually cost less to insure than domestic cars.
What Is a Foreign Car?
A foreign car typically refers to a vehicle manufactured by a company based outside the United States. These include:
- Japanese brands: Toyota, Honda, Nissan, Subaru, Mazda, Mitsubishi
- German brands: BMW, Mercedes-Benz, Audi, Volkswagen
- Korean brands: Hyundai, Kia, Genesis
- British, Italian, or Swedish brands: Jaguar, Land Rover, Alfa Romeo, Volvo, Fiat
It’s important to note that many foreign automakers manufacture vehicles in the U.S., so the term “foreign” often refers to the brand’s country of origin, not necessarily where the car is assembled.
Are Foreign Cars More Expensive to Insure?
They can be, especially when compared to mainstream domestic models like Ford, Chevrolet, or Dodge.
Here’s why foreign vehicles often come with higher insurance premiums:
1. Cost of Repairs and Parts
Many foreign vehicles especially European models require specialty parts that may be:
- Imported from overseas
- More expensive than domestic equivalents
- Available only through dealerships
Labor costs may also be higher due to the need for certified technicians trained to work on specific systems.
2. Luxury and Performance Features
Many foreign brands (like Mercedes, BMW, Audi) fall into the luxury category and include:
- Advanced electronics
- High-end materials
- Turbocharged or high-performance engines
These features increase the vehicle’s value and repair costs, which leads to higher comprehensive and collision premiums.
3. Higher Theft Risk
Some foreign cars, particularly Hondas and luxury models appear on the most-stolen vehicle lists each year.
| Brand | Theft Risk (High/Medium/Low) |
| Honda | High (Civic, Accord) |
| BMW | Medium |
| Toyota | Medium |
| Audi | Low |
| Mercedes-Benz | Medium |
The higher the theft risk, the more insurers charge to cover comprehensive claims.
4. Insurance Repair Networks
Some insurers have a preferred repair shop network, and foreign vehicles may need to go outside that network raising costs.
How Much More Do Foreign Cars Cost to Insure?
Here’s a side-by-side comparison of average annual premiums:
| Car Model | Country of Origin | Average Annual Insurance |
| Honda Civic | Japan | $1,615 |
| Toyota Corolla | Japan | $1,635 |
| Volkswagen Jetta | Germany | $1,780 |
| BMW 3 Series | Germany | $2,200 |
| Audi A4 | Germany | $2,185 |
| Mercedes-Benz C-Class | Germany | $2,450 |
| Ford Focus | USA | $1,525 |
| Chevrolet Malibu | USA | $1,510 |
As you can see, luxury European brands can cost $500–$1,000 more per year to insure compared to domestic or basic Japanese vehicles.
Which Foreign Cars Are Most Expensive to Insure?
Here are some foreign models with historically high insurance costs:
| Vehicle | Brand | Avg. Annual Premium |
| Mercedes-Benz S-Class | Mercedes-Benz | $2,700+ |
| BMW 7 Series | BMW | $2,650+ |
| Audi Q7 | Audi | $2,400+ |
| Range Rover Velar | Land Rover | $2,800+ |
| Porsche Cayenne | Porsche | $3,100+ |
These are luxury vehicles, and their high value, complex components, and repair costs drive up premiums.
Which Foreign Cars Are Cheaper to Insure?
Some foreign cars are surprisingly affordable to insure especially economy models known for safety and reliability.
| Vehicle | Brand | Avg. Annual Premium |
| Honda CR-V | Honda | $1,450 |
| Toyota Camry | Toyota | $1,495 |
| Mazda CX-5 | Mazda | $1,460 |
| Hyundai Elantra | Hyundai | $1,490 |
| Kia Soul | Kia | $1,480 |
These models often have:
- High safety ratings
- Lower theft risk
- Easy-to-source parts
- Affordable repair costs
How to Lower Insurance Costs for Foreign Vehicles
Even if your foreign car costs more to insure, you can still reduce your premium with smart strategies.
1. Increase Your Deductible
Choosing a higher deductible can lower your monthly payment. Just make sure you can afford the out-of-pocket cost in case of a claim.
2. Bundle Your Policies
Combine auto and home (or renters) insurance with the same provider to save 10–25%.
3. Use Telematics or Usage-Based Programs
Safe drivers of foreign cars can save with programs like:
- Progressive Snapshot
- Allstate Drivewise
- GEICO DriveEasy
- State Farm Drive Safe & Save
These apps track your driving and reward safe habits with discounts.
4. Maintain a Clean Driving Record
Avoid tickets, claims, and at-fault accidents to qualify for:
- Safe driver discounts
- Claims-free bonuses
- Accident forgiveness
5. Compare Quotes Often
Rates vary widely across insurers. Use a comparison tool like Alias Insurance to check rates every 6–12 months.
When Should You NOT File a Claim?
Avoid filing if:
- The repair cost is less than or equal to your deductible
- You’ve recently filed other claims (which could impact renewal)
The damage is minor and purely cosmetic (not affecting resale, function, or safety)
Is It Ever Cheaper to Insure a Foreign Car?
Yes. In some cases, foreign economy cars (like the Honda Fit or Toyota Yaris) may be cheaper to insure than American performance cars or pickups. Why?
- Smaller engines = lower collision risk
- High safety ratings = fewer injuries
- Easy repairs = lower claims cost
Real-Life Example
Driver: Miguel, 28
Location: Dallas, TX
Vehicles Compared:
- 2018 BMW 3 Series
- 2018 Honda Accord
Quotes (Full Coverage, Clean Record):
- BMW: $2,285/year
- Honda: $1,645/year
Difference: $640/year
Miguel said:
“The BMW felt premium, but I wasn’t ready to spend $50 more every month for insurance. I went with the Accord, and I’m happy with the lower costs.”
FAQs: Foreign Cars and Insurance
No. Luxury and high-performance models typically cost more, but many Japanese and Korean cars are competitively priced.
Not directly. Insurance companies focus on repair costs, safety ratings, and theft rates, not just manufacturing location.
Yes, especially for European brands. This can increase repair time and insurance payouts raising premiums.
Some do. High safety ratings can lower your premium, even on foreign models.
Yes. Gray-market imports (not originally sold in the U.S.) can be difficult and expensive to insure due to lack of repair parts and regulatory compliance.
Final Thoughts
So, are foreign cars more expensive to insure?
Often, yes, especially when you’re looking at European luxury vehicles or performance models. But if you’re considering a reliable Japanese or Korean sedan or SUV, you may find rates comparable or even cheaper than their American counterparts.
Bottom line:
The cost to insure a foreign vehicle depends on the make, model, repair costs, theft risk, and safety features not just where the brand is headquartered.
Before buying, use Alias Insurance to compare personalized car insurance quotes and make sure your dream car won’t become a financial burden down the road.
