Manual vs. Automatic: Which transmission has higher insurance costs?

With time, the whole concept of buying a car has evolved. A buyer has way too many choices at his/her disposal, including body type, fuel type, displacement, luxury, performance, features, engine type (conventional or hybrid or electric), drivetrain, safety rating, and the list goes on. Adding to this long list is also transmission type—manual and automatic. This particular choice is a bit crucial because it not only influences the car’s overall cost but also impacts the insurance premium.

If you are in the market for a car, consider the transmission type wisely. Don’t limit the choice just to personal preference; consider its long-term impact on your finances and monthly budget. In this article, we’ll explore both manual and automatic transmissions and their respective impacts on insurance costs.

Without any delay, let’s explore the transmission and insurance relation in detail. But before that, we think our readers, especially those new to the world of cars, deserve a brief explanation of different transmission types. So, let’s get started -

Manual and automatic transmission - An overview

The modern-day car buyer has the option to choose between automatic and manual transmission. As one can understand, while the former does the gear-change for the driver, the latter requires the driver to help themselves.

The fundamentals are -

• In a manual car, the driver controls the gear change via the gear stick, while pressing the clutch pedal.
• In an automatic car, there is no clutch pedal and the gear shifting is done automatically by the system based on the pace of driving.

Also Read: Changing the clutch type: Here's how you can modify your driver's license

Understanding manual transmission

Also known as stick shift, it describes an automobile wherein the driver shifts the gear manually as they accelerate and decelerate. All this is done via the shift lever located on the centre console which is linked to the transmission via linkage.

How do you use it? Only through practice can one master the art of driving a manual transmission. It involves using the clutch pedal, located to the left of the brake pedal and the gear stick. To change gears, the driver must depress the clutch pedal (which disconnects power from the engine to the transmission), shift the gear lever to the desired gear, and release the clutch pedal (which reconnects the engine power to the transmission). Overall, a significant amount of input is needed from the driver, as only they can select and change the gear.

Note that if the clutch pedal is released too soon, the engine will stall. On the other hand, if released too slowly, there would be premature wear.

Fact file -

• Less than 3% of the Philippine automobiles are found with manual transmission.
• In Europe and Asia, more than 80% of cars feature manual transmission.

Pros & cons -

Pros	Cons
Low cost of acquisition.	Requires practice to drive proficiently.
Fuel efficient.	Requires coordination (clutch, and shifting should be done at once).
Offers a sense of control.	Low resale value.
Preferred by driving enthusiasts for its superior acceleration.	Driving in traffic is challenging.

Also Read: Save your clutch: 5 things manual drivers should never do

Understanding automatic transmission

Unlike manual transmission, where the driver actively participates in gear shifting, here the car automatically takes care of gear shifting via fluid pressure.

One of its most important components is the planetary gear set, which is also known as the brain of the automatic transmission.

How does it work? The fluids of the automatic transmission offer the needed pressure to engage the clutch and the bands to determine the gear the car should be in. In addition to lubricating and cooling the transmission parts, this fluid also aids the propulsion.

Completely no action is required at the driver’s part to change the gear. Here the drivetrain is connected to a torque converter, which acts similar to a clutch in a manual transmission car. The gear change is taken care of by the locking and unlocking of planetary gears via the fluid. Overall, minimal input is required from the driver’s end, i.e., put the car in gear and go.

Fact file -

• 95% of cars in the United States are automatic units.
• It relies on automatic transmission fluid and a planetary gear set.

Pros & cons -

Pros	Cons
Less stressful to drive and use.	Expensive compared to manual cars.
High resale value.	High repair cost.
Convenient to drive through traffic.	Less fuel efficient than manual cars.
Perfect for beginners or old drivers.

Manual vs. Automatic

There are a few parameters on which a buyer can compare the two transmissions, including, insurance, fuel efficiency, and driving ease. While we’ll be discussing the insurance angle in detail later, meanwhile, let us discuss the remaining two.

Parameter	Automatic	Manual
Fuel efficiency	It is commonly believed that automatic cars are less fuel-efficient than manual units. However, with technological advancements, things are changing. For a fact, dual-clutch automatic transmission cars have proved to be more economical than their manual counterparts.	Though manual cars are considered more fuel-efficient than automatic units, the figures largely depend on the driving style, gear selection, engine revs, and transmission technology.
Driving ease	Not a suitable option for buyers wanting to experience an exhilarating driving feel.	Gives the diver full control over engine speed and gearbox.
Cost and maintenance	Mostly expensive. Repair and maintenance will bleed the driver’s wallet due to its complex nature.	Generally cheaper and easier to maintain than automatic cars. Also, it lasts longer than its more complex sibling.

Manual vs. Automatic: Car insurance premium

An automatic car comes with a complex gearbox that consists of expensive parts, which if damaged and sent for repair can burn a hole in your pocket. And this is the exact reason why insurance providers charge more for automatic car insurance. They are a bigger liability for the companies compared to manual cars.

The table below further elaborates on the subject -

Automatic car insurance	Manual car insurance
Automatic cars are a bigger liability for insurance companies, due to high transmission repair or replacement costs. Therefore they are expensive to insure.	Manual transmission is much simpler and easy to repair, and the insurance premium is comparatively low.

Overall, it’s just the underlying factors like safety and value that dictate the insurance cost of automatic and manual cars.

Also Read: Why you need automatic car insurance coverage in the Philippines

Key tip -
To accurately determine the impact of gearbox type on the premium, we’d recommend using an insurance calculator or get quotes directly from the insurers. However, make sure to consult only with reputed insurance providers.

Manual & automatic cars - Factors affecting car insurance premium

The car insurance premium of manual or automatic cars is influenced by several factors, including -

• Car model and make: This one influences the insurance cost of both automatic and manual cars, with high-end models attracting more premium.
• Coverage: While CTPL insurance is mandatory, comprehensive insurance along with other add-ons offer greater coverage and add to the premium cost.
• Owner’s profile: The age, driving history, and experience of the driver greatly influence the premium.
• Owner’s location: Urban location like Metro Manila attracts more premium, due to the high risk of theft, and damage.
• Claim history: If there is a history of claims, and a car accident, then expect a higher premium.
• Safety features: Cars with airbags, advanced driver assist features, dash cam, and other safety gear attract a low premium.

Tips to maintain an automatic car

Since automatic cars are expensive to repair and insure, it is wise to learn some basic maintenance tips to ensure the car maintains its charm for long. The list includes -

• Taking care of the car’s engine, if not working properly it will put pressure on the car’s transmission.
• Don’t put pressure on the brake pad else it will put pressure on the engine and transmission. Also, make use of parking brakes while parking the car on an incline or decline. Thus reducing stress on the parking linkage.
• Regularly check the car’s transmission fluid, as low or contaminated fluid can result in permanent wear & tear, grinding gear, and overheating.
• Never shift the gears drastically, as it can damage the unit.

Bottom line

The Philippines auto market is a diverse one with all types of cars on offer - be it manual, automatic, or electric. However, when buying a car, one should consider the overall cost of car ownership and not just the unit’s price. Insurance is one of the crucial factors impacting the car’s cost and therefore should be given proper consideration. However, the cost of insurance also depends on several factors including the car’s overall value, location, driver’s profile, etc. Likewise, the insurance cost also depends on whether the car has an automatic or manual transmission. That’s because the two are different in terms of maintenance cost, fuel efficiency, and resale value. Therefore, we’ll suggest a car buyer weigh the benefits of both types of transmission against his/her personal preference, driving condition, and financial situation, before making a final call.

Also Read: Top 5 things you must do after buying a new car in the Philippines