Does Car Color Affect Insurance Rates? Myths vs Facts

You've probably heard it before: "Don't buy a red car — it'll cost you more on insurance." Maybe a friend swore by it. Maybe your uncle told you when you were buying your first car. It's one of those "facts" that just gets passed around.

The problem? It's not true. Not even a little bit.

There's a surprising amount of misinformation floating around about what drives car insurance rates. Some of it is harmless. Some of it can actually cost you money — either by steering you toward the wrong car or keeping you from optimizing your coverage. Let's clear the air.

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Myth #1: Red Cars Cost More to Insure

This is probably the most persistent insurance myth out there. The idea goes that red cars attract more police attention, get more speeding tickets, and therefore cost more to insure.

The truth: Insurance companies don't ask about your car's color. When you apply for auto insurance, you're asked about the make, model, year, trim level, and VIN — not whether it's Candy Apple Red or Midnight Blue. Color is simply not part of the rating formula.

Where did this myth come from? Possibly from the association between red sports cars and speeding. But it's the "sports car" part that might affect your rate, not the "red" part. More on that in a minute.

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Myth #2: Older Cars Are Always Cheaper to Insure

It sounds logical: a newer, more expensive car costs more to replace, so it should cost more to insure. And for comprehensive and collision coverage, that's often true.

But here's where it gets nuanced: liability insurance — which covers damage you do to other people and their property — is typically a bigger cost driver than the value of your own vehicle. A 2005 pickup with a perfect safety record might cost similar amounts to insure as a 2020 sedan, depending on your driving profile and where you live.

Also, older vehicles may lack modern safety features like automatic emergency braking, lane-keeping assist, and backup cameras — features that can actually lower your premiums on newer models.

The takeaway: don't assume an older car is automatically the cheaper choice for insurance.

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Myth #3: Minimum Coverage Is Enough

Many drivers opt for the state minimum liability limits because it's the cheapest option. And yes — it keeps you legal. But "minimum" often means you're dangerously underinsured.

Consider this: if you're at fault in an accident and the other driver racks up $80,000 in medical bills, but your policy only covers $25,000 — you're personally on the hook for the rest. That could mean lawsuits, wage garnishment, or losing assets.

Minimum coverage can make sense if you're driving an older car with low market value and have very limited budget. But for most people, bumping up liability limits by a few dollars a month is one of the best financial decisions you can make.

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Myth #4: Your Credit Score Doesn't Affect Your Rate

In most U.S. states, insurance companies use a version of your credit history — called an "insurance score" — as a factor in pricing. Studies have shown a statistical correlation between credit history and the likelihood of filing a claim, so insurers have incorporated it into their models.

If your credit has improved recently, that's worth knowing — it could mean lower premiums. If it's taken a hit, it might be worth shopping around with carriers that weight credit differently, or asking about available discounts that can offset the impact.

(Note: California, Hawaii, Massachusetts, and Michigan have restrictions on using credit for auto insurance pricing.)

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Myth #5: Sports Cars Always Cost More to Insure

This one is partially true, but it's more complicated than people think.

Yes, high-performance sports cars — think a Porsche 911 or a Dodge Hellcat — tend to come with higher premiums. They're expensive to repair, attract drivers who push them harder, and have higher theft rates.

But a "sports car" label alone doesn't guarantee a rate hike. A used Mazda Miata, for instance, is technically a two-seat roadster but often insures quite affordably. Meanwhile, a full-size luxury SUV can cost significantly more to insure than a basic sporty coupe.

What actually matters to insurers: the car's repair cost, theft rates for that model, safety ratings, engine displacement, and how the car performs statistically across claims data.

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What Actually Affects Your Car Insurance Rate

Now that we've cleared out the myths, here's what insurance companies actually look at:

• Your driving record — This is the big one. Accidents, DUIs, and speeding tickets can significantly raise your premium. A clean record is your best friend.
• Your age and experience — Teen drivers and new drivers pay more. Experience (and a clean record) brings rates down over time.
• Where you live — Urban areas with high traffic density, theft, and accident rates cost more than rural areas. Your ZIP code matters.
• How much you drive — Higher annual mileage = more exposure = higher risk. If you work from home and barely drive, some insurers offer low-mileage discounts.
• Your coverage choices — Higher deductibles lower your premium; lower deductibles raise it. The coverage types and limits you select directly shape your cost.
• The car itself — Make, model, year, safety ratings, repair costs, and theft frequency all feed into the calculation.
• Credit history — In most states, your insurance score plays a role.
• Claims history — Prior claims — even ones where you weren't at fault — can affect your rates.

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Quick Tips to Lower Your Premium

• Bundle policies — Insuring your car and home (or renters) with the same carrier usually earns a multi-policy discount.
• Ask about discounts — Good student, safe driver, defensive driving course, low mileage, anti-theft devices — these add up.
• Shop around — Rates vary widely between carriers for the same profile. Comparing quotes is the single fastest way to find savings.
• Raise your deductible — If you can afford to cover more out-of-pocket after an accident, a higher deductible lowers your monthly cost.
• Review your coverage annually — As your car ages, it may no longer make financial sense to carry full collision and comprehensive coverage.

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The Bottom Line

Car color won't change your insurance bill. Neither will a lot of the other "facts" people repeat like gospel. What actually moves the needle is your driving record, your vehicle's real-world risk profile, your location, and the coverage choices you make.

The best way to make sure you're paying a fair rate — and not overpaying — is to compare options from multiple carriers and understand what you're actually buying.

Get a free quote from Truvo and see how rates compare for your car, your coverage, and your situation. No fluff, no pressure — just a clear look at your options.

Learn more about auto insurance at Truvo →