With factory closures related to the COVID-19 pandemic, plus microchip and other supply shortages, the current era is predicted to remain tough for American car buyers. The shortage of new cars naturally influences used car prices as well. Anyone hoping that the used vehicle market will improve drastically in the near term is likely to be disappointed. While used car prices are softening, they remain historically high.¹

Kelley Blue Book says prices should remain inflated for years and used cars below $15,000 will remain challenging to find.² Moreover, the average financing rate for used cars is now at 11.7 percent which makes financing more difficult for consumers who don’t have the option to pay cash.³

The availability of websites such as Craigslist and Ebay Motors has made it easier (and cheaper) for sellers and buyers of used cars to connect. In most cases, older vehicles are cheaper to insure than newer cars as they have lower replacement values than a newer, similar model. Also, many people do not add comprehensive coverage for their used cars, preferring to simply pay potential costs out of pocket on their lower-valued automobiles.

For the near-term future, saving on car insurance and lowering your car expenses remain the two best ways to save on car ownership. Navigating the ins and outs of buying auto insurance can be tricky, but luckily your insurance experts at Answer Financial can guide you through the basics of coverage.

Who is Answer Financial?

As one of the nation’s largest and most reputable auto & home insurance agencies, Answer Financial has insured nearly 5 million homes and vehicles. We work with 40+ top-rated carriers to save our customers an average of $565 a year on insurance.*

On our mobile-friendly website, shoppers can quickly compare rates and customize coverages from multiple home insurers. By simply entering your zip code and home address, Answer can search publicly available records like square footage and year built to deliver side-by-side comparison quotes from reputable insurance companies.

Answer Financial can help you compare, buy and often save the smart way on insurance. So before you shop, remember to rely on your insurance experts to find you the right home insurance plan for your needs and budget.