Automotive

Future Insurance Cost for a Current Renter

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  • Nov 3rd, 2020 9:29 pm
[OP]
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Aug 21, 2016
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Calgary, AB

Future Insurance Cost for a Current Renter

Namaste All

I immigrated to Canada four years ago as a student and I do not own a car here. I feel I am just not ready for the ownership level commitments towards a car, I live next to my workplace and do not need a car for commuting. I rent a car on the weekends (usually every other weekend) for groceries and stuff. Rentals are great, I can plan ahead using Costco's car rentals and the insurance is covered by my credit card cost is less than $200/month (annual average.) It's been pretty great so far.

I had a driver's license for 8 years in India, but the car was registered under my mom's name. In India the car is insured and not the driver, so it doesn't usually matter. Once I moved here, I have been licensed since 2017, so total 11 years of driving experience, but not insured once.

While browsing the fican subreddit I noticed someone posted an insurance quoted of $620/month. For me buying a car is not a priority, but I might end up buying a luxury car/truck/cybertruck in the next 2-4 years. If I understand this correctly then the insurance premiums are directly proportional to the amount spent on road with no accidents. Is it worth exploring getting a beater car to earn some credibility before getting the real car?

The real question here is, since I don't plan on driving this beater car nor invest on it (it will be parked for the term), Does it then matter if I don't put any mileage on it? Or should I be exploring something like a car-less insurance (I could not find any concrete information on this) which can help me bring down the insurance cost before I actually buy the car?

TIA
RFD Effect Is Real
10 replies
Deal Guru
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Mar 23, 2008
12342 posts
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Edmonton
whizzzkid wrote: Namaste All

I immigrated to Canada four years ago as a student and I do not own a car here. I feel I am just not ready for the ownership level commitments towards a car, I live next to my workplace and do not need a car for commuting. I rent a car on the weekends (usually every other weekend) for groceries and stuff. Rentals are great, I can plan ahead using Costco's car rentals and the insurance is covered by my credit card cost is less than $200/month (annual average.) It's been pretty great so far.

I had a driver's license for 8 years in India, but the car was registered under my mom's name. In India the car is insured and not the driver, so it doesn't usually matter. Once I moved here, I have been licensed since 2017, so total 11 years of driving experience, but not insured once.

While browsing the fican subreddit I noticed someone posted an insurance quoted of $620/month. For me buying a car is not a priority, but I might end up buying a luxury car/truck/cybertruck in the next 2-4 years. If I understand this correctly then the insurance premiums are directly proportional to the amount spent on road with no accidents. Is it worth exploring getting a beater car to earn some credibility before getting the real car?

The real question here is, since I don't plan on driving this beater car nor invest on it (it will be parked for the term), Does it then matter if I don't put any mileage on it? Or should I be exploring something like a car-less insurance (I could not find any concrete information on this) which can help me bring down the insurance cost before I actually buy the car?

TIA
No matter what, you're likely to start paying high insurance to begin with, and it will drop over time as you build a driving history. So you'll pay big bucks now for a car you're not actually using, or you can wait and pay big bucks later for a car you ARE using. To me, I see no reason to pay insurance and registration fees now if you're only going to park the vehicle. If you want to do anything, put aside an extra couple hundred dollars per month now, so you have a cushion of money in the future to subsidize an actual vehicle you want to drive.

But honestly, if it was me, I'd buy an inexpensive, reliable car, like a beige Corolla. Use it for your weekend running around. Rent a car for longer trips, if you like. And then, if you decide you want to upgrade in the future, you have a car you can sell, you'll have a insurance history, and you're good to go. Plus you get RFD bonus points.

C
[OP]
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Aug 21, 2016
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Calgary, AB
CNeufeld wrote: No matter what, you're likely to start paying high insurance to begin with, and it will drop over time as you build a driving history. So you'll pay big bucks now for a car you're not actually using, or you can wait and pay big bucks later for a car you ARE using. To me, I see no reason to pay insurance and registration fees now if you're only going to park the vehicle. If you want to do anything, put aside an extra couple hundred dollars per month now, so you have a cushion of money in the future to subsidize an actual vehicle you want to drive.

But honestly, if it was me, I'd buy an inexpensive, reliable car, like a beige Corolla. Use it for your weekend running around. Rent a car for longer trips, if you like. And then, if you decide you want to upgrade in the future, you have a car you can sell, you'll have a insurance history, and you're good to go. Plus you get RFD bonus points.

C
Thanks for the advice on the paying the insurance only when I drive the car. Just wondering is there any way to be insured without actually owning a car?

Regarding the beige corolla, I get the sentiment. In India, Corolla is considered a luxury vehicle. I used to drive a 2001 beige suzuki zen, the epitome of inexpensive, reliable beater car in India. I brought it for ₹100,000 ~$2000, driven for 90k/11yrs, I drove it for 30k kms for 4 years and then you cannot renew the registration (>15 year rule in India) and sold it for scrap for ₹35,000 ~$700. I then "upgraded" to a beige suzuki baleno and drove that to the scrap yard.

Once I moved here I made some changes to my lifestyle and did not want to drive to work so I live next to the workplace or work remote. At this point the car would not be a necessity but a pure indulgence hence a splurge on a "luxury" car, but that's way in the future. I just wanted to make sure I am not doing anything wrong by not getting a car right now.

Sample Images:

Zen:

Image

Baleno:

Image
RFD Effect Is Real
Member
May 20, 2018
265 posts
254 upvotes
Toronto, ON
whizzzkid wrote: Thanks for the advice on the paying the insurance only when I drive the car. Just wondering is there any way to be insured without actually owning a car?

Regarding the beige corolla, I get the sentiment. In India, Corolla is considered a luxury vehicle. I used to drive a 2001 beige suzuki zen, the epitome of inexpensive, reliable beater car in India. I brought it for ₹100,000 ~$2000, driven for 90k/11yrs, I drove it for 30k kms for 4 years and then you cannot renew the registration (>15 year rule in India) and sold it for scrap for ₹35,000 ~$700. I then "upgraded" to a beige suzuki baleno and drove that to the scrap yard.

Once I moved here I made some changes to my lifestyle and did not want to drive to work so I live next to the workplace or work remote. At this point the car would not be a necessity but a pure indulgence hence a splurge on a "luxury" car, but that's way in the future. I just wanted to make sure I am not doing anything wrong by not getting a car right now.

Sample Images:

Zen:

Image

Baleno:

Image

Lucky they didnt sell the Maruti 800 here in canada, would have become RFD favorite :)
Petrohead to EV-head , if there is one.
[OP]
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Aug 21, 2016
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Calgary, AB
JanardhananR7411 wrote: Lucky they didnt sell the Maruti 800 here in canada, would have become RFD favorite :)


Doug did a suzuki swift review in Mexico and was amazed what USD 12k got him it would have been a goto car if they sold here.
RFD Effect Is Real
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Sep 1, 2004
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If you can live with a lifestyle with rental on weekend, stick with it and save the money and invest it.

Start paying when you need a car. There's no point paying for something you don't need in hope of saving you don't know you may have in the future.
[OP]
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Aug 21, 2016
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Calgary, AB
Xtrema wrote: If you can live with a lifestyle with rental on weekend, stick with it and save the money and invest it.

Start paying when you need a car. There's no point paying for something you don't need in hope of saving you don't know you may have in the future.
I just hope I can resist the temptations. :D
RFD Effect Is Real
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Sep 1, 2004
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whizzzkid wrote: I just hope I can resist the temptations. :D
Well, then it's a want, not a need. A whole different justification criteria.
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Jul 7, 2017
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SW corner of the cou…
Not sure how much your weekend rentals run (all in) but you may consider a car share. Save the cash and just build up your years of driving experience in the meantime.
I smile when I see container ships sailing past my house laden with stuff made in China
[OP]
Member
User avatar
Aug 21, 2016
365 posts
501 upvotes
Calgary, AB
thriftshopper wrote: Not sure how much your weekend rentals run (all in) but you may consider a car share. Save the cash and just build up your years of driving experience in the meantime.
I seriously miss car2go here in calgary, We now have CommunoAuto but they do not seem to have enough cars, plus the service area is too small.

All-in on an average, my total monthly rental expense including gas is between $200-$300. This swells if I am doing a road trip, but then I've seen people renting out cars for the road trips even if they own/lease a car.
RFD Effect Is Real
Deal Fanatic
Jul 7, 2017
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SW corner of the cou…
whizzzkid wrote: I seriously miss car2go here in calgary, We now have CommunoAuto but they do not seem to have enough cars, plus the service area is too small.
I forgot the left the market. Too bad the Alberta arm of CAA doesn't have a share programme like BCAA has.
All-in on an average, my total monthly rental expense including gas is between $200-$300.
Would booking ahead (if you can) reduce that amount? Discount codes are your friend.
This swells if I am doing a road trip, but then I've seen people renting out cars for the road trips even if they own/lease a car.
If the trip is far away enough, renting costs may be lower than wear 'n tear costs, and also peace of mind if your car is older and less reliable (hence the value of a beige Corolla).
I smile when I see container ships sailing past my house laden with stuff made in China

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