Common Auto Insurance Myths
Buying car insurance can be a complicated procedure. It's important to carefully choose the right coverage, so it's no surprise there are some misconceptions about how auto insurance works. Here are a few of the more common myths about auto insurance.
Red cars cost more to insure
Many drivers also believe that red cars get pulled over more often, but there is no data to support these myths. Insurance companies look at a variety of factors to determine a customer's rate, but color is not one of them.
Older cars cost more to insure
Insurance companies do look at the type of car being insured to help determine your rate, but its age is not the deciding factor. A car's "loss factor," or how often it is reported stolen, is much more important. Newer cars do have advanced security features which can protect from would-be thieves and may lower your insurance rate.
If a friend borrows my car, he is responsible for damages
Insurance is applied to the vehicle, not the driver. If you give someone permission to borrow your car, it is your insurance policy that will apply in the event of an accident.
My insurance covers theft, weather and disasters
Most states mandate liability coverage on all vehicles. This policy covers any medical expenses that you or a third party may incur as the result of an accident. Liability coverage does not cover the car itself, for which you need comprehensive and collision coverage. These policies will pay for repairs or replacement to the vehicle in almost every circumstance.
When choosing your insurance policy be sure to ask questions or work with an agent that can explain the differences.