Last Updated on July 31, 2026
Written by licensed insurance agent Andy walker
Reviewed by the Alias Insurance editorial team.
Yes, car insurance can go up while your car gets older and loses value. Vehicle value is only one part of the premium. It mainly affects collision coverage and other than collision coverage, which may pay for damage to your own car. Much of the bill can also pay for injuries or property damage you cause, medical benefits, uninsured driver protection, and other coverage that does not shrink with your car’s value.
An insurer prices the expected cost of future claims. It may review repair labor, replacement parts, theft data, crash losses for your model, medical costs, lawsuits, weather losses, your ZIP code, mileage, driving record, coverage limits, deductibles, and discounts. A lower vehicle value may reduce one part of the rate while increases in several other parts push the total premium higher.
Age can affect a model in mixed ways. An older car may be cheaper to replace. Yet it may have scarce parts, fewer crash avoidance features, or poor theft results. Insurers rely on filed rating rules and claim data.
Start with the renewal declarations page. Compare each coverage charge with the prior term, confirm the vehicle data, and ask the insurer which rating factors changed. Do not remove protection based only on the car’s model year. State laws, lender terms, household finances, and the amount you could pay after a loss should guide that choice.
Why does a lower car value not guarantee a lower premium?
A car policy combines several forms of protection. Only some of them focus on the insured car’s current value.
Collision coverage can pay for covered crash damage to your vehicle. Other than collision coverage can pay for covered theft, fire, hail, flood, vandalism, glass damage, falling objects, and animal strikes. If the insurer declares the car a total loss, payment is generally tied to its value just before the loss, subject to the policy, deductible, and state rules.
Liability coverage works differently. Bodily injury liability can pay for covered injuries you cause. Property damage liability can pay for damage you cause to another person’s car or property. An older car can still injure a person or destroy an expensive new vehicle. Your car’s falling resale value does not reduce that possible loss.
The same principle may apply to uninsured motorist protection, medical benefits, rental reimbursement, and roadside service. Each has its own price and purpose.
| Part of the policy | Does the insured car’s value matter much? | Why its price may still rise |
| Bodily injury liability | Usually little | Medical bills, legal costs, claim frequency, and selected limits |
| Property damage liability | Usually little | Cost of vehicles, structures, and other property you could damage |
| Collision | Often yes | Labor, parts, model loss results, deductible, and total loss value |
| Other than collision | Often yes | Theft, weather, glass, vandalism, and model loss results |
| Uninsured motorist protection | Usually limited | Injury and damage costs, local uninsured driver losses, and limits |
| Personal injury protection or medical payments | No direct link | Medical costs, state rules, and selected limits |
The Insurance Information Institute states that vehicle price, repair cost, safety record, theft risk, driving record, location, mileage, credit information where allowed, and chosen coverage can affect premiums. No one factor controls the final price.
Does an older car usually cost less to insure?
Often, but not always. Physical damage coverage may become cheaper as the car loses value. The total bill may not follow.
Consider a simple example. A driver pays $1,500 for a six month policy. Collision and other than collision coverage account for $400. The remaining $1,100 pays for liability and other benefits. At renewal, depreciation helps lower the physical damage portion by $40. At the same time, the insurer raises the other portions by $120 because expected injury, repair, and local claim costs increased. The new total becomes $1,580.
This example shows why falling value and a rising premium can occur together.
The U.S. Bureau of Labor Statistics reported that motor vehicle insurance prices rose 2.8 percent during 2025. It also reported a 5.4 percent rise in motor vehicle maintenance and repair prices during that year. Those national measures do not explain one person’s renewal, but they show that claim related costs can change while a vehicle depreciates.
Which age related vehicle factors can raise insurance costs?
Vehicle age does not create one fixed surcharge. Insurers examine the loss results tied to the make, model, model year, trim, location, and coverage. Several patterns may offset depreciation.
Parts can become harder to obtain
Some older vehicles use parts that manufacturers no longer produce in large numbers. A shop may need a used, rebuilt, or special order part. Delays can extend repair and rental time. Many common old models still have broad parts supplies, so the result depends on the exact vehicle and claim data.
Labor and paint costs can rise
A ten year old bumper still needs removal, paint matching, installation, and shop time. The car’s value may fall, but the technician’s hourly rate does not fall because the car is old.
Theft risk can remain high
Thieves do not choose vehicles only by value. They may target a common model with weak security or strong parts demand. The National Insurance Crime Bureau reported 850,708 U.S. vehicle thefts during 2024, down 17 percent from 2023. Its five most stolen models included the Hyundai Elantra, Hyundai Sonata, Chevrolet Silverado 1500, Honda Accord, and Kia Optima. A national list cannot predict one rate, but model theft data can matter after depreciation.
Older safety equipment may affect loss results
An older model may lack automatic braking or other crash avoidance systems. The Highway Loss Data Institute has linked certain systems with lower claim frequency, though results differ by system, driver age, vehicle age, and coverage. New sensors can also make a newer vehicle costly to repair. No rule says old always costs more or new always costs more.
The car may cross a rating data threshold
Insurers update model results as more claims arrive. A model may later show higher theft, glass, crash, or injury losses. Ask whether its vehicle symbol or rating group changed. The insurer should explain the main renewal reason and any notice required by state law.
Which increases have little to do with vehicle age?
Many renewal increases happen at the same time a car ages but are not caused by age.
Liability and injury costs
Medical treatment, lost income, legal defense, and settlements can raise liability claim costs. They relate to harm caused in a crash, not the insured car’s value.
Your location
Rates can differ by location because traffic, theft, weather, repair prices, fraud, and claim frequency differ. A move can change the territory. A carrier may also revise rates in your current area under state rules.
Your mileage or use
A longer commute, more annual miles, delivery work, rideshare activity, or business use can change risk. Report use accurately. Drivers who travel less can review how to track mileage for pay as you go insurance before choosing a program that measures use.
A household driver change
Adding a teen or a driver with violations can affect the policy. A licensed household member may need to be listed even if that person rarely drives the old car.
Credit based insurance information
Many states allow some use of credit based insurance information, while others restrict it. The NAIC says state rules differ. A permitted insurance score change can affect renewal without a crash or ticket.
Lost discounts
A discount can end because a course expired, mileage changed, a bundle ended, or a student no longer qualifies. Compare the discount section line by line.
Higher limits or lower deductibles
Higher limits, a lower deductible, or added rental or roadside benefits can raise the premium. Confirm every selection.
Broad rate changes
The NAIC explains that weather, inflation, repair prices, medical bills, lawsuits, fraud, and reinsurance can affect prices. A rate filing can affect clean drivers with aging cars.
For a closer review of renewal causes, read why insurance can rise after a clean year.
How can you find the exact reason your premium increased?
Use the current and prior declarations pages, renewal notice, and discount list.
1. Compare the same policy periods
Compare equal policy periods. Separate premium from fees or a prior balance.
2. Compare each vehicle and coverage
Compare liability, collision, other than collision, uninsured motorist protection, medical benefits, rental, and roadside charges. On a multi car policy, find which vehicle changed.
3. Check all rating details
Confirm the vehicle identification number, model year, trim, address, mileage, use, drivers, and discounts.
4. Ask focused questions
Ask the agent or insurer:
- Which coverage charges increased?
- Did the vehicle rating symbol or model loss group change?
- Did my territory, mileage, insurance score, or household driver data change?
- Did any discount expire or shrink?
- Was a new rate filing applied at renewal?
- Can you send the reason or renewal notice in writing?
5. Request a corrected quote if data is wrong
Provide accurate proof, such as mileage records or a driver status update. Never change facts only to get a lower price.
6. Contact your state insurance department if needed
State regulators can explain notices, complaint steps, and licensing. They can review possible errors or rule violations.
Should you drop collision coverage on an older car?
Do not use a fixed age as the only test. A ten year old car can still be worth enough to protect.
The California Department of Insurance tells consumers to consider whether collision and other than collision coverage remain suitable on an older car. The Texas Department of Insurance gives similar guidance for an older paid off vehicle.
Review these figures:
| Question | Why it matters |
| What is the car worth now? | A total loss payment is generally based on current value, not the price paid years ago |
| What is the deductible? | The deductible reduces a covered payment |
| What do these coverages cost? | Ask for the price of each coverage, not only the full premium |
| Could you replace the car yourself? | Dropping coverage shifts that financial risk to you |
| Is there a loan or lease? | The lender may require physical damage coverage |
| Is theft or weather risk high? | Lower car value does not remove these hazards |
If a car is worth $6,000 with a $1,000 deductible, a covered total loss might pay about $5,000 before other adjustments. If it is worth $2,000 with the same deductible, compare the smaller possible payment with the yearly coverage price. Also weigh theft risk and your cash reserve. Read when to drop collision based on car value before changing it.
Dropping collision does not remove required liability coverage. State rules differ, and lenders can require more. Review the minimum car insurance your state may require and confirm the rule with your state.
How can you lower the cost without creating a dangerous gap?
The cheapest renewal can leave a driver exposed to a large loss. Review savings in this order.
- Correct errors in mileage, vehicle, driver, and garaging data.
- Ask for every discount for which you qualify.
- Compare quotes using the same drivers, limits, deductibles, and endorsements.
- Ask how much each optional coverage costs before removing it.
- Consider a higher deductible only if you can pay it after a sudden loss.
- Review collision and other than collision coverage against current vehicle value.
- Keep liability limits that protect your income, savings, and property.
- Avoid a coverage lapse, which can raise future costs and leave you uninsured.
- Check usage based or low mileage options only if the rules fit your driving and privacy choices.
- Ask a licensed agent to explain any term you do not understand.
Use how to estimate a premium before buying a car when planning your next vehicle. Insurance cost can vary by model even when purchase prices look similar.
Frequently Asked Questions
No. There is no national birthday that automatically raises every car’s premium. A carrier can update the vehicle’s rating group based on approved rules and claim data. The total can also change because of location, coverage, mileage, drivers, discounts, and broad rate changes.
Liability coverage pays for covered harm you cause to other people and their property. An old car can still cause serious injury or damage an expensive vehicle. Medical, legal, repair, and settlement costs can rise even while your own car depreciates.
It can be cheaper, especially for collision and other than collision coverage, because its current value is often lower. The result is not certain. Theft results, repair costs, driver details, ZIP code, coverage choices, and discounts can outweigh depreciation.
No single dollar amount fits every driver. Compare the car’s current value, deductible, annual coverage price, possible net claim payment, lender terms, and your ability to replace the car. Ask for the exact savings before changing coverage.
Yes, if state law and the carrier’s approved rating rules permit the change. Local claim costs, rate filings, vehicle loss data, insurance score where allowed, mileage, household drivers, and expired discounts may affect renewal. Ask for the reason in writing.
Not necessarily. Different companies may price the same risk differently, so comparison can help. Match every limit, deductible, driver, vehicle, and endorsement. A lower quote with weaker protection is not an equal quote.
Final takeaway
Car insurance can rise as a vehicle ages because depreciation affects only part of the policy. Liability losses, medical bills, repair labor, theft, model claim results, location, mileage, discounts, and broad rate updates may have a greater effect. Check the renewal line by line, correct errors, compare equal quotes, and change physical damage coverage only after weighing vehicle value, deductible, savings, lender rules, and your ability to fund a replacement.
Insurance contracts and rating laws vary by state. Your policy, declarations page, endorsements, and state rules control your coverage and price. Ask the insurer, a licensed insurance professional, or your state insurance department about your own policy.
Alias Insurance can help drivers compare car insurance quote options from available providers. Compare the same limits, deductibles, drivers, and coverage terms so price differences are meaningful.
Sources and References
- Insurance Information Institute guide to auto insurance pricing
- U.S. Bureau of Labor Statistics review of 2025 consumer prices
- National Insurance Crime Bureau report on 2024 vehicle thefts
- Insurance Institute for Highway Safety research on crash avoidance claim results
- National Association of Insurance Commissioners consumer auto guide
- National Association of Insurance Commissioners explanation of premium increases
- California Department of Insurance auto insurance guide
- Texas Department of Insurance tips for saving on auto insurance
