Smart cars are a relatively new phenomenon in America, although they have existed in Europe for many years. Of course, crowded European streets are better-suited to the tiny economical vehicles than the open roads of the United States, where muscle cars and sport utility vehicles reign. Nevertheless, as the economy struggles, many people are considering these economical and fuel-efficient vehicles. Not only are these cars cheap to purchase, they’re also surprisingly affordable to insure.

Why Smart Cars are Cheaper to Insure

All other factors being equal, smart cars may cost less to insure per month than a regular sedan or other family vehicle. There are many reasons why this may occur:

1.) Safety Ratings

Despite their small size, smart cars are surprisingly durable. The steel frame resists crumpling, and the cars are more likely to roll, intact, than crumple. This makes them safer in many ways than family-sized sedans. Their light weight and maneuverability also makes them less likely to cause substantial damage in auto accidents; because they’re small, they brake quickly and cause little damage to vehicles that they collide with.

2.) Replacement Cost

Smart cars are some of the cheapest vehicles on the market. The average model costs less than $15,000 to purchase new. This makes them much cheaper to replace than other types of vehicle if they’re totaled out in an auto accident. In turn, insurance companies will charge less for their premiums.

3.) Target Drivers

Most people who own smart cars tend to be from low-risk driving populations. People choose this type of vehicle because they are environmentally conscientious, frugal and statistically risk-averse. Smart cars are also under-powered, so it’s unlikely that people will engage in risky behaviors like those associated with sports cars or other high-powered autos.

4.) Fuel Economy

Many insurance companies offer discounts to drivers who opt for environmentally-friendly transportation, including smart cars, electric cars and hybrids. Not all insurance companies offer these discounts, but they’re becoming more popular as “going green” becomes a mainstream lifestyle choice, so it’s certainly worth investigating with your insurance company to see if these discounts are available.

5.) Lower Mileage

It’s unlikely that most people will take smart cars on cross-country road trips or spend a lot of time on the interstate. Even among people who own them as primary cars, smart cars are usually used for in-town driving, and they rack up fewer miles than other types of vehicles. This isn’t true of all smart cars, but it’s true of enough that insurance companies can afford to offer lower rates.

One area that smart cars do pose a higher-than-normal risk for is theft. Because they are small and novel, they are an ideal target for thieves. Be sure that you fit your smart car with an anti-theft device and, if possible, keep it in a garage at night. This will reduce the cost of your premiums and protect the vehicle from thieves.

Despite all of these factors, smart cars are not always the best choice for all drivers. They’re too small for families, of course, and there is no way to safely put a child’s car seat in a smart car. Parents will need a reasonable-sized sedan or minivan with decent fuel economy. Some large-statured people may also have a difficult time driving it comfortably due to its compact size. The cars also generally come with very bare accessories, so people who are accustomed to luxury vehicles may be disappointed in the lack of features.

Drawbacks and Considerations to the Smart Car

Although it does have a high safety rating, smart cars are prone to certain kinds of collision damage that can be fairly serious. The car does not absorb damage as gently as larger vehicles, so minor accidents may cause more injuries and discomforts from whiplash or similar issues. The car is also under-powered and people may find its performance lacking for highway driving or heavy commuting.

If you’ve been considering purchasing a smart car, however, you can rest assured that the insurance should be quite affordable. The money that you save on car payments, insurance and gas will certainly add up to a substantial amount over time, making this smart car a good investment for the right kind of driver.

You can request a free insurance quote in advance to see how much it might cost to purchase coverage for the vehicle before you decide on buying it; this may help you determine whether a smart car is the best choice for your next family vehicle.