The 8 Most Common Car Insurance Myths

When it comes to car insurance, there are a lot of myths that everyone believes. However, separating the myths from the facts can help you determine how to find your best insurance rate and will keep you from feeling frustrated and overwhelmed when insurance companies make the decisions that they do. The following 8 myths are the most commonly believed in the world of automobile insurance.

 Some Colors are More Expensive Than Others

Usually, if you have a red car, people assume that your insurance premiums are going to be higher. Certain colors are given “sporty” labels, which supposedly drives up the cost of insurance. In actuality, the color of your car has nothing to do with the cost of your insurance. Rates are determined by a variety of factors, like engine, body style, where you park it, the year, the model, your age, and driving behavior. Speeding, crashes, and other road violations are going to drive up your premiums faster than anything having to do with the color.

Old Cars Won’t be Stolen

That is actually an incredibly false idea. In fact, according to the National Insurance Crime Bureau, older cars are more likely to be stolen. The most stolen cars between in 2007 included 1995 Honda Civics, 1991 Honda Accords, the 1989 Toyota Camry, and 1994 Ford trucks. Usually, older cars are targeted because they are easier to break into, easier to hot wire, are easier to sell or break down for parts, and have less theft protection.

All Plans Include Extra Coverage

Many people incorrectly assume that when they purchase insurance things like theft, natural disasters, and vandalism are included. This is not the case. If you want these events covered, you have to add a comprehensive and collision coverage for extra fees. Ordinary plans come with only the most basic coverage. Leases and new cars usually require that the driver purchase additionally insurance than older cars and non-lease cars.

Your Credit Score Doesn’t Change Insurance Rates

Not many people realize this, but your credit score will change your insurance rates. The better your score, the lower your rates. Why? Because it tells them how well you can manage your finances. You will have to pay more if the company feels you may skip out on insurance payments or are otherwise a financial risk in any way.

Your Policy Can be Canceled at Any Moment

Actually, insurance companies have to have a good reason for canceling your policy. Usual causes include non-payment or fraud. In many countries, the government has specific guidelines and rules about when an insurance company can cancel the policy.

Personal Property is Covered

Just like many people assume that natural disasters and other factors are included, many assume their personal property is covered by insurance as well. Usually, this is not the case.  In most cases, personal property loss is covered by homeowner insurance- not car insurance.

Rental Cars are Included

Most basic plans do not cover rental cars. However, most insurance companies allow rental coverage for a small additional fee. Usually, rental car fees are very low. Pay attention to how long the rental fees are covered, as going over may result in unexpected costs.

Sports Cars Cost More

Just like people assume that certain colors cost more, sports cars are assumed to cost more as well. However, rates are usually only higher for high-risk drivers. High-risk drivers include young age, multiple moving violations, and a high number of accidents.

Now that you know the truth about car insurance premiums, you can face your insurance box charges with confidence. There is no need to worry about high insurance charges if you are a safe driver with few moving violations or accidents.
Dan McCarthy is a freelance writer and a car enthusiast. He also loves playing tennis and the morning runs with his dog.

***Photos thanks to Wikimedia Commons and Pixabay***