Oh, the Cruel Irony: Smaller, Cheaper Cars Are More Expensive to Insure

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Studies have shown that poor people tend to pay more for auto insurance. Guess who else pays a premium? People who own small, inexpensive cars—a group that also tends to be poor.
Insure.com has just released its list of the most and least expensive 2012 cars to insure. On average, as you might guess, the absolute most expensive vehicles to insure are fast, pricey sports cars and luxury automobiles from automakers such as Audi, Mercedes, BMW, and Porsche. The reasons these cars cost so much to insure is that they’re likely to be in more accidents—because drivers want to take advantage of their powerful engines and drive them fast—and are especially expensive to repair, as anyone who has had to order a replacement part for an Audi can attest.

If fast, fancy, pricey cars are the most expensive cars to insure, then one might assume that the opposite—basic commuter cars low on horsepower and relatively cheap to fix or replace—would be the least expensive to insure. But that assumption is flat wrong.

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The cheapest new cars to insure tend to be large, sturdy minivans, SUVs, and trucks. Among the list of the 20 least expensive cars to insure, none could be called a compact or even a mid-size vehicle. And why is that the case?

Using Insure.com’s data, a MarketWatch column points out that insurance for a four-door Honda Civic ($2,353 per year) is more than double that of a Toyoto Sienna ($1,111), Jeep Patriot Sport ($1,116), or the half-ton pickup GMC Sierra K1500 ($1,121). Here’s part of the explanation why a bland, seemingly safe car like a Civic costs more to insure:

Civics are considered more menacing cars because they are generally driven by younger drivers with no children in bigger cities. They’re also compact cars, which means an accident will result in more damage, causing more repairs, and more injuries, all of which are figured into the insurance rate.

The high costs of health care, then, have a direct impact on auto insurance rates. Also, trucks, SUVs, and minivans exist in greater numbers in rural areas and the suburbs—spots that are safer than cities in terms of both fewer accidents and less theft. The Honda Civic is also one of the most-often stolen cars out there too.

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The forces setting insurance rates aren’t necessarily discriminating against the poor, or those who prefer smaller, less-expensive, more fuel-efficient cars. Not directly anyway. But the net effect is that low-income drivers and those behind the wheels of smaller cars are penalized because of where they tend to live—in high-density urban settings, where there are more cars on the road, hence more chances to get into accidents. And when these small cars get into accidents, there’s more chance that people inside will be hurt worse than if they were driving in a pickup or a minivan.

Brad Tuttle is a reporter at TIME. Find him on Twitter at @bradrtuttle. You can also continue the discussion on TIME’s Facebook page and on Twitter at @TIME.

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