Insurance

There’s nothing like the look, smell and feel of a brand new car, especially if it also boasts the brand new March 2008 number plate registration. But if you really realised how much your shiny new car will depreciate in value in its first year, you’d perhaps decide to take a little more time to choose a car model that will better withstand the financial battering of its first few years on the road. Alternatively, even if you already have your heart set on the car of your dreams, you should at least ensure that your chosen car insurance provider will not penalise you for any depreciation, should your car be written off in the first year.

According to motoring website Autotrader, some cars are worth just 30% of their sale value after just three years. But, even worse, it is in those first few months, while you’re still enjoying your honeymoon period with your sparkly new motor, that your car is suffering the worst depreciation of all. A recent uSwitch survey, for instance, revealed that some car models lose as much as 50% or more of their value in their first year alone. According to the research, worst performers over the past year have been the Ford Focus, with 48% depreciation in the first year and 65% over three years, while the Vauxhall Vectra has fared worse, with 58% depreciation in the first year, rising to 78% by the end of year four. Not that all models and makes suffer the same loss in value – a lot depends on the number of each model manufactured and on how the brand is perceived by consumers. The BMW 325d SE coupé, for instance, has withstood market forces more successfully, with statistics suggesting that it suffers only a 25% depreciation in its first year, rising to 56% by year four.,/p>

Of course, the depreciation in the value of your car is one of those facts of life that you may just be prepared to live with. But at least ensure that you are getting the best and most cost-effective car insurance you can find, should you be the proud owner of a brand new car. Should your car be written off in its first year, for instance, some car insurance providers will provide cover to replace it with a new model. Others, however, will only pay out the ‘market value’ of the car, minus the depreciation. That could mean you losing out should the worst happen. Take the time to shop around – BeatThatQuote.com provides an easy online route to comparing numerous car insurance providers so you can ensure you’re getting the best cover for your new car at the most reasonable cost.

Alternatively, if the rapid depreciation in value on a new car is just too much for you to stomach, you might take a different tack altogether and decide to go second-hand instead. Even here, though, it’s well worth you knowing the facts on models that depreciate in value faster than others, as you might just be able to pick up a bargain (www.whatcar.co.uk has a handy depreciation index of top-selling cars that should help, whether you’re buying new or second-hand). This year’s release of the Jaguar XF model, for example, means that demand for the older S-Type has dropped, together with the price tag. But, remember, if you have managed to bag yourself a bargain, don’t lose out by getting inadequate or needlessly expensive car insurance. You should shop around just as carefully for the right insurance cover, no matter what car, or rather age of car, you choose to buy.