Buying auto insurance is tough enough without having to worry about how coverage works. Instead, it pays to stay informed and understand the process. Here are three common auto insurance myths and the real truth behind them.
Myth #1: The Color of Your Car Affects How Much You Pay
Perhaps the biggest misconception about auto insurance coverage is that the color of your car affects how much you pay in premiums. In fact, many drivers even shy away from purchasing red vehicles, which pop culture has led some to believe have higher rates than other colors.
Unfortunately, this is not true. Many insurance companies never even ask the color of your vehicle at the time you purchase a policy. Instead, they are more concerned about factors that increase the cost of replacement parts should you have a claim. (Examples include the type of vehicle and any special modifications it has.) Furthermore, your driving history and credit score affect rates more than the type of vehicle you drive.
Lesson: Keep your driving record clean and your credit score up. These two factors are commonly what cause auto insurance rates to be higher.
Myth #2: Personal Property Inside Your Car is Covered by Auto Insurance
One myth most drivers believe is that personal property inside the car is covered under their auto insurance policy—whether it is destroyed in a major accident or stolen by a thief. The truth is, all personal items are covered only under a property policy, such as homeowners or renters insurance. This includes items such as golf clubs, laptop computers, cell phones, handbags/wallets etc. Surprisingly, even your pet is considered personal property.
Lesson: Never leave any personal items of importance in your vehicle unless you have adequate renters or homeowners insurance.
Myth #3: Letting a Friend Borrow Your Car Means His Insurance Will Pay
Another common misconception about auto insurance involves letting others borrow your vehicle—such as friends or relatives that live outside your household. The truth is that auto insurance follows the car and not the driver.
Lesson: If your buddy, who has a history of tickets and accidents as big as a phone book, asks to borrow your SUV for the weekend, always say no.
Although these are three of the most common myths about auto insurance, there are many others. It is important to contact your local independent insurance agent if you have any confusion about what your policy covers and what it does not.
We know the difference between fact and fiction. Contact The Yates Agency for more information on auto insurance.