Government Program Fuels Demand for Cheap Auto Insurance

Drivers across America may have more reasons than ever to shop for cheap auto insurance now that the government's Cash for Clunkers program is getting started.

The $1 billion law was signed by President Obama earlier this year and pays consumers up to $4,500 in credit to cash in old vehicles for newer, more fuel efficient models.

"It's a wonderful program. It helps out the environment, it helps out the customer, and it gives a jump to the automobile industry when it needs it the most," Phoenix auto dealer Scott Gruwell was quoted as saying in a recent Reuters report.

According to the Kansas City Star, the federal government is expected to finalize regulations on the program by July 23, and auto dealers are generally advised to wait until that point before formally participating.

The Star also notes that drivers will get a rebate of $4,500 if their new vehicle gets at least 5 miles per gallon or better than their old one, while a rebate of $3,500 will apply to those with a vehicle that gets 2 to 4 mpg more than their previous one.

As more people invest in newer cars though, it's only natural that they would also want to shop around for a cheap auto insurance policy.

ShareThis