Does the colour of your car affect your insurance rate?

7 minute read Published on Apr 15, 2024 by BrokerLink Communications

A happy laughing woman sitting in the passenger seat of a retro pink car on a sunny day

Many people wonder what factors come into play when their car insurance rates are being calculated. After all, these factors directly relate to the premium that you are given, so it makes sense that you want to know what details matter. To find out how insurance companies calculate premiums and, specifically, whether the colour of your car matters, keep reading.

Does colour impact auto insurance premiums?

In short? No. The idea that the colour of your automobile can result in you paying more for car insurance is a complete myth. While there are a wide variety of factors that an insurance company will consider, the colour of your car is not one of them. Thus, contrary to popular belief, whether you drive a red car, a blue car, or a black car will have no impact on your insurance premium whatsoever. So go ahead and choose whatever vehicle colour catches your eye!

Is auto insurance more for red cars than other colours?

No. Just because you drive a red car does not mean that you will pay more for your auto insurance policy. There are many myths surrounding red cars and insurance. First, some people believe that because red cars stick out more, they may be more prone to getting noticed by law enforcement officers, thus at greater risk of a traffic ticket or infraction. Meanwhile, others draw a link between coverage for more expensive sports cars and the fact that many sports cars are red, but the reality is that sports car insurance is usually higher due to the increased speed capabilities and odds of getting into an accident. To avoid this increased rate, find out more about what is considered a sports car for insurance.

At the end of the day, no matter where you heard about these red car myths, your car insurance company will not increase your rate simply because you drive a red car.

Why do drivers care about colour?

Since insurance companies don’t care about the colour of your car, why do drivers care? For a number of reasons. For example, many people prefer specific vehicle colours for aesthetics. In other words, they simply like the look of one colour over another. Meanwhile, others choose a car’s colour based on whether it blends into its surroundings, for the resale value, or so that dirt and ice are less visible on it.

There are even some people who specifically choose a vibrant or unique colour because they want their vehicle to stand out. Ultimately, each person has their own reason for selecting the colour of their car, but none of them should have to do with insurance since colour does not impact insurance rates.

When colour matters to car insurance companies

Although an insurance company will never base your rate on your car's colour, a few colour-related factors could impact your premium. Namely, if your car has a custom paint job or the manufacturer uses a costly paint, then this could impact your rates. The reason for this is that the cost of repainting or touching up your car in the event of damage would be more expensive due to the custom colour or expensive type of paint. The same goes for if you make other customizations to your vehicle, such as wheels, lights, or sound systems.

Insurers will look at how much your insurance premium will cost to repair or replace if an accident occurs and base your insurance premium on that. So, if your car is more expensive or highly customized, that means that your insurance claim amount will be higher, and as such, they may raise your premium. You can find out more about filing car insurance claims each year and how different types of auto insurance can cover you in the event of an accident.

What factors car insurance premiums

As mentioned above, there are a number of factors that impact car insurance premiums - colour just isn’t one of them. Below, we provide a brief overview and then a more in-depth description of each and every factor that has the ability to influence how much you pay for car insurance:

  • Where you live
  • Age
  • Gender
  • Vehicle type
  • How you use your vehicle
  • Driving record
  • Driving experience
  • Past claims
  • Prior insurance coverage
  • Number of kilometers you drive
  • Type of coverage on your policy
  • Your deductible(s)


Location is one major factor when an insurance company is determining your rates. Certain location-related factors that come into play include the amount of traffic where you live, the average number of collisions, the crime rate, and the weather. Generally speaking, insurance rates tend to be lower for drivers who live in rural areas since fewer cars are on the road, reducing their odds of getting into a car accident.

That said, if vehicle theft is common in your neighbourhood, then your rates might be higher. An insurance broker might also recommend adding comprehensive car coverage to your policy so that you are protected in the event of theft. Lastly, if you live somewhere that experiences severe weather or natural disasters throughout the year, this could also impact your rates.

The type, make, and model of your vehicle

Again, while colour doesn’t matter, several other factors related to your car do. Namely, the type of car you drive, including the year, trim, make, and model of the car will all impact how much your insurance policy costs. Luxury cars are the most expensive to insure as they are the most costly to replace or repair. However, if your car has many safety features, this could decrease your rates. To determine the risk level of your car, an insurance agent will analyze the theft rates, collision rates, and repair costs of your specific vehicle.

Your driving record

Your driving record is perhaps the most important factor that affects auto insurance rates in Canada. An insurance company will look up your driving record to determine your risk level. If you have multiple driving infractions, such as traffic tickets, at-fault collisions, or DUI charges, your rates are likely to be much higher than if you have a clean record. For this reason, we recommend doing everything you can to keep your record clean, including following these safe driving tips and obeying all local traffic laws.

Your annual mileage

Your annual mileage is the fourth factor an insurance company will likely consider when calculating your auto insurance premium. As you might suspect, having low mileage can benefit you. From an insurance company’s point of view, the less time you spend on the road, the lower your odds of getting into a car accident and needing to file a claim.

Thus, if you drive infrequently, it might be worth letting your insurance broker know to see if you qualify for a lower rate. A broker can help you calculate your mileage to see if you are eligible for any sort of discount.

The insurance coverages you choose

The types of insurance coverage you add to your policy will also impact your rates. The more coverage you choose to add, the more expensive your policy will be. While you will have no choice but to add mandatory coverages to your plan, such as liability car insurance, accident benefits coverage, and uninsured automobile insurance, it is up to you to decide if you want to add optional coverage.

Examples of optional coverage include accident forgiveness coverage, collision coverage, loss of use coverage, waiver of depreciation, and more. Adding any of these coverages to your plan will increase your rates. However, doing so will also increase your protection. Speak with an insurance broker for a professional opinion on what types of coverage are worth adding to your policy.

The limits and deductibles you select

Not only are you able to choose whether to add certain coverages to your policy, but as the policyholder, you also get to choose the limits and deductibles you want. For example, the legal requirement for third-party liability car insurance in most provinces is $200,000, but many drivers do not find this amount to be sufficient. Instead, they opt for a higher limit of $500,000, $1,000,000, or even $2,000,000. Having over a million dollars worth of liability coverage will certainly come in handy if you get into a major accident, but this higher coverage limit is likely to increase your rates. The general rule of thumb for limits and deductibles is as follows: The higher the limit, the higher the premium, and the lower the deductible, the higher the premium. Thus, if you're looking to cut costs, opting for low limits and high deductibles might be the way to go. However, for greater coverage and protection, higher limits and low deductibles are usually recommended.

Bonus: Your credit score

Not all car insurance companies consider a customer’s credit score when calculating their rates, but some do, so that’s why we’ve included it here. When assessing your risk, an insurance agent might ask for your credit score or a copy of your credit history. Why? Credit relates to risk. If you have a good credit score, this indicates that you are financially responsible, which, from an insurance company's perspective, decreases your risk of delayed payments or non-payments.

Contact BrokerLink for more information

Now that you know more about how car insurance companies determine rates, including that colour isn’t a determining factor, you likely have a better understanding of why you pay what you do for auto coverage. That said, if you still have questions about how premiums are calculated, contact BrokerLink today. One of our licensed insurance advisors can provide even more insight into how insurers calculate rates, as well as offer tips and advice on ways that you can keep your premium low. For example, if you’re buying a new car, you may wish to consider a cheaper one, one with lots of safety features or a high reliability rating, or a van or SUV, which tend to have less expensive premiums than other types of vehicles.

Finally, if you want to learn more about auto insurance costs where you live, request a free car insurance quote from BrokerLink today. We offer free quotes over the phone or in person. All you have to do is visit one of our locations and a licensed insurance broker will be happy to help. Alternatively, you can also request a free quote on our website using the online quote tool. It takes as little as five minutes!

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