Insurance companies use symbol age groups to help them assess the rate they charge for comprehensive insurance policies. A comprehensive policy typically pays for the cost of replacing or repairing a vehicle if it is stolen or damaged by things like falling tree limbs, flooding, fire and natural disasters. Comprehensive insurance is typically required in addition to collision insurance when leasing or financing a vehicle. Collision insurance covers damage resulting from an auto accident with another vehicle.
How Rating Symbols Work
The Insurance Services Office sets the standard for the symbols the car insurance industry uses to rate vehicles. ISO has created symbols that range from 1 to 75 for vehicles built before 2011, and numbers 1 to 27 for vehicles built 2011 and later. The numbers correspond to the value of the cars from $1.00 to $80,000+ for cars manufactured prior to 2011 and $1.00 to $150,000+ for those manufactured since 2011. For example, a car with the symbol 24 would be worth between $22,501 and $23,125 in the old rating system and between $50,001 and $60,000 in the new system.
Cost of Replacement
One of the biggest factors in determining what type of symbol that is assigned to an individual vehicle is the cost to replace it. The higher the replacement cost is, the higher the symbol number. This also means that the premium you would have to pay for your comprehensive insurance coverage will also be higher than a vehicle with lower symbol numbers.
Cost of Repair
Repairing a vehicle can be costly and affects the ratings. High performance vehicles can cost a lot more to fix because of the computerized equipment and expensive parts they have versus a luxury vehicle that might have a similar MSRPs. According to CarsDirect.com, the average insurance cost for a luxury vehicle in 2012 was $1,000 to $3,000 per year. A high-performance car of similar value costs between $2,700 and $3,000 per year.
The symbol assigned to a vehicle changes over the lifetime of the car -- even if you keep on owning the same one for many years. The reason: When a car ages, the value of the vehicle declines due to usage and wear and tear. The average depreciation rate for vehicles is 15 percent per year until the vehicle turns five years old. The symbol age can change several times over the five-year period, and each change should reduce the cost of the comprehensive insurance coverage to reflect the car's decreasing value from one year to the next.
- State Farm Mutual Automobile Insurance Company: Types of Auto Insurance Coverage
- Insurance Services Office: ISO's Symbols for Individual Makes and Models of Cars
- Boston Software Corporation: UPDATE: Converting ISO 75-Symbol to ISO 27-Symbol
- Boston Software Corporation: ISO Vinmaster Changes for Model Year 2011 and Newer
- CarsDirect.com: Insurance for High-Performance Cars: Average Rates to Expect on Exotic Luxury Vehicles
- CarsDirect.com: What Is the Average Car Depreciation Rate?
Griffith Pritchard served as a senior branch manager and banking officer for M&T Bank. He specialized in small business and personal financial, credit and banking products. He also has extensive experience in small business sales and non-profit management. Pritchard is a graduate of Hobart College.