As automobiles depreciate, insuring them becomes more affordable. Unfortunately for those seeking to cover their new-to-them vehicle, the Bureau of Labor Statistics has been reporting sharp gains in used car prices, which were up 10.5% month-on-month in June and 45% compared to the year prior, according to Insure.com.

There are several influencing factors are at hand, including:

• The pandemic forced automakers to shut factories or run them with smaller workforces, in turn reducing the number of vehicles produced. This, combined with a surge in demand, led to inventory shortages.
• Also in short supply have been semiconductor chips, which are used for a variety of safety and driving features. Again, many chipmakers had to close operations when the pandemic hit. Despite production volume returning to normal, the high demand for chips in a range of products is perpetuating supply shortages.
• Since many couldn't buy new automobiles due to shortages, the go-to option became used cars. This strongly reduced the volume of inventory dealers had. Additionally, consumers turning in leased vehicles and rental car fleets being turned over took hits during the past year, further reducing the pool of used cars for sale.

As insurance can tack 15% or more onto monthly car costs, Insure.com noted it is important consumers consider this as well as additional costs such as warranties when shopping for a used car.

When it comes to making coverage decisions, the online quoting sites reported the following are two good rules to follow:

• If the car is less than 10 years old or worth more than $3,000, you should get full coverage.
• If the car is older and you wouldn't spend your own money for mechanical repairs, it may be time to skip comp and collision and start saving for a replacement vehicle.

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• Most expensive cars to insure in the U.S.