As car dealer across the U.S. are trying to catch up with the skyrocketing demand for new cars, insurance agents are also preparing themselves for the expected numbers of new car owners.
Even with the troubles encountered by the “cash for clunkers” program, insurance providers are expecting to see a sudden spike in the demand for new car insurance. Industry sources have revealed that agents are preparing for the arrival of car owners searching for the perfect insurance policies for their newly acquired vehicles.
Earlier last week, the federal government’s Car Allowance Rebate System (CARS) was suspended on fears that the $1 billion allocated by Congress would not last long enough. The Congress has since then agreed to allot another billion dollars for the ‘clunkers’ program in hopes of jumpstarting the auto industry as well as the U.S. economy.
In fact, auto dealers are saying that car sales in the nation rose to their highest rates in 11 months just this July. They add that the tax rebates ranging from $3,500 to $4,500 are giving Americans the chance to buy newer, more economical cars. The federal government is hoping to get gas-guzzling vehicles off the road as soon as possible. Substantial tax rebates are offered for drivers who trade in their aging cars in exchange for vehicles that are at have at least a four mpg improvement. Cars that feature 10 or more mpg improvement can qualify for the maximum $4,500 rebate.
With the continuation of the ‘clunker’ program, insurance firms are gearing up for increasing number of car owners looking for car insurance. Experts say that the best way for new car owners to get affordable premiums would be to consider buying hybrid vehicles. Most providers offer a ten percent discount for hybrid technology cars. Aside from being more economical, the general demographics for the people who buy hybrids is also a huge factor for cheaper insurance.
Analysts say that most owners of hybrid cars belong to a more mature age group. A large majority are also married and have ample financial capabilities. They are also less likely to get into accidents. Specialists refer to these types of policyholders as the “preferred insured category.” However, most hybrid car owners are from the city, presenting a higher risk for accidents. Even so, industry sources contend that most owners of these vehicles are relatively safer and more reliable on the road.