Brazil: Insurance Another Hurdle to Car Ownership
Brazil has some of the highest car prices in the world. Taxes, protectionism and high margins, coupled with the fact that Brazilians are gobbling up each and every car built in Brazil guarantees that this fact of life will not change any time soon. On top of that, Brazilians must pay 4 percent of the car’s price each year as tax.
Another hurdle to overcome in order to stick that shiny metal blob of your dreams in your garage is insurance. Relatively low coverage, relatively high theft rates and lots and lots of accidents are the excuses insurance companies use to get quite a chunk of change out of their customers’ pockets and into their own. As you can see from the video, even those who should protect you, can be out to get you.
Webmotors, a well-know Brazilian enthusiast site, recently did a run down of just how much it costs to insure the top ten most sold vehicles this year. They used the profile of a 40 year old male living in the South Zone of São Paulo. The beloved VW Gol, the most sold car in Brazil for over 25 years and going, will force its owner to fork over almost 10 percent of the car’s price in order to get it insured. Just one of a myriad of reasons I have for never, ever, contributing my hard-earned money to keep this legend alive.
Below is a table showing the lowest annual insurance premium Webmotors was able to find for popular Brazilian entry models. The premiums were converted to US dollars at today’s rate of $.48 to the Brazilian real.
Annual cost to insure an entry level car in BrazilCarAnnual InsurancePercentage of Car’s PriceVW Gol$9859.43%Fiat Uno$8017.48%Fiat Palio$7647.52%VW Fox$1,0935.46%Chevy Celta$6716.75%Ford Fiesta$6875.91%Renault Sandero$5144.50%Chevy Classic$6214.75%Fiat Siena$6695.38%VW Voyage$4933.80%Don’t know about you, but I hate paying for insurance. My cars have never been robbed, I almost never get into an accident, in short, sometimes I feel like it’s wasted money. I for one am keenly aware of these numbers and they carry a lot of weight when I’m deciding which car to buy.
So, I want to know: Do you factor in the cost of insuring a car when you buy one? Or do you consider the cost of such so marginal that it simply isn’t a factor?
What do I hear? You pay much more for your BMW 550i? Ah, the land 0f plenty.
More by Marcelo de Vasconcellos
Comments
Join the conversation
Insurance to pay for your own ride should it become damaged is a minor part of the issue. The real reason you'd want insurance is in the case of you being at fault and hitting not just one other car but causing a chain reaction crash (icy highway maybe??) and all of a sudden half a dozen other vehicles are damaged and maybe someone goes to the hospital (or worse). That's why the people out there who think the state minimum limits are adequate frighten me. You want someone (the insurance co) on your side when you get hauled in to court by the other parties. They want to protect their assets and you get to ride along as part of your premium. No sense in just giving up your assets or having your wages garnisheed for the rest of your life... I became aware of an interesting twist on insurance in Germany recently. Sure you can go as fast as you like on some Autobahns, but if you are exceeding the "recommended" blanket maximum speed limit of 130km/h and cause a wreck you will be partly financially responsible YOURSELF, no matter what insurance coverage you have. i.e. you can legally go faster than the "recommendation" in the unlimited parts of the network, but you dirently share in the consequences should you have a problem...
Hi Marcelo!!! Insurance cost of VW Gol's is absolutely mad!! And it hasn't changed for years, I used to read Quatro Rodas when I was a teenager (sometimes old issues bought used here in Uruguay)and there was always some mention to this matter. I owned two Gols (1.0 G3 2005 and 1.6 G5 2010)and insurance cost for both was about U$D 500/600, the older one being cheaper but not too much (BTW the little girl in my avatar is my daughter and she's at the Gol G3 wheel). And even more surprising that you will pay half as much as you do for a Gol to insure a Voyage, being just the same car with and added trunk. Obviously it must be because of owner profile, but what a difference!!! Parabens!