Assume i’m 27 and i have a relatively clean driving record. A no fault accident at 16, and a speeding ticket at 22 are all i have.
At age 27 i might want to buy a 3 year old a Mercedes-Benz C230 (i just discovered that a 3-4 year old C230 is only about 4-5k more than a non-luxury car). How would this affect my insurance rates? would there be a permanent jump in insurance? How does the insurance jump work exactly if the car is only worth $15k?
I think it depends in part on what state you are in. State meaning NY, AZ, etc. Not state of mind. 
Your rates will be lower than buying a hotrod. And since luxury cars have a lot of safety and anti-theft devices, that helps in the eyes of the insurance company. Example: I had a beater '92 car with no special options, I bought a '97 luxury car with all the toys, my insurance payment went down. Another scenairo: I moved from the suburbs to the city, my insurance payment doubled. So it all really depends on where you live, your driving record, the toys the car has and the profile of the car (prone to be stollen, etc.). Check out Geico.com for a quote.
Luxury cars are not what get the insurance to jump.
I went from a 1978 Oldsmobile Gut…er…Cutlass to a 1984 Camaro. Insurance went up (IIRC) about $400/year.
Again, went from a Honda Accord to a Chrysler LeBaron Convertible Turbo. Insurance jumped again almost $500/year.
When I finally unloaded the POS (LeBaron) I got a Cadillac DeVille. Insurance went down.
According to my agent the LeBaron was so high because it was a convertible and it had a turbocharger.
Try it - I’ve never owned a Mercedes but my friends who have them swear by them.
Well, it all depends. Sure, my “luxury” car has lots of safety features and such, but it also expensive as hell to fix, both parts and labor. So while my collision coverage may be reasonable, my comprehensive is very high.
Some cars are more likely to be stolen, and their comp will be higher. Some cars are more prone to having accidents (fast cars, sporty models, turbos, etc) and all coverages will be higher.
Also, newer models are more expensive to replace, but on the other hand most people don’t have comp on a POS.
Your rate will be determined by-
Probably in that order.
I don’t shop around for rates. I found the best company (IMO) in terms of service, longevity, claims servicing and reputation. I pay more than some people, but it’s totally worth it when I need it.
Oops, first paragraph, coverages are reversed…