For N.C. car insurance, smaller equals cheaper

Friday, August 22, 2008

If a big, hulking, fuel-guzzling SUV collided with a fuel-efficient small car on the street, which one would win? It's likely the SUV would.

But if you put the two up against each other on insurance costs, the big guy would lose. That's because in North Carolina smaller equals cheaper.

A story in Sunday Money Aug. 3, written out of Texas, indicated that the cost to insure a small, fuel-efficient car was so much more than for a crash-safer SUV, that the difference could offset the added cost of fueling the gas-guzzler.

But that's in so-called no-fault insurance states, said James E. Moore, president and owner of the James E. Moore Insurance Agency in Wilmington.

Insurance is regulated by the states, so each state is different, Moore said. "Some states have no-fault liability insurance, and North Carolina is not one of them."

In no-fault states, the owner of a vehicle pays for injuries to his or her vehicle's occupants. "If someone is driving a large vehicle, it probably would be safer," Moore said.9

Liability is the only part of the insurance premium that varies, Moore said. "Liability is the same for automobiles. The type of car is not a factor in determining the liability premium," he said.

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Resource: http://www.starnewsonline.com/