Car Insurance Myths: BUSTED!

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Whether it’s about rates dropping when you turn 25, or that full coverage insurance automatically means that your insurance company will ensure that you get a new car after a crash, we’ve all heard some auto insurance myths that have somehow been accepted as fact.  Being an informed consumer when it comes to your insurance is important and we’re here to help bust six common car insurance myths.

First off, buying a red car isn’t automatically going to mean a higher premium. Insurance companies don’t actually care what color your car is and when you call us for a quote, we don’t ask for that information either. While the old stereotype that police might spot a speeding red car quicker than a white one may or may not be true, your insurance company is more concerned with the year, make and model of your vehicle when quoting a premium.

Brand new or luxury cars don’t make you a bigger target for thieves. In fact, according to most sources, the most frequently stolen cars are Honda Accords models from the early to mid-1990’s. Unlike newer or more singular cars, 90’s era Accord models are much better suited for thieves to pull in-demand parts like catalytic converters and sell them. Regardless of what you drive, the best way to protect your car against theft is to get comprehensive insurance.

Don’t assume that the longer you’re with your insurance company, the cheaper your rate will be. Longevity with your insurance company doesn’t necessarily guarantee that your rates will go down. While a lot of insurance companies will offer discounts to long-term policyholders, that discount isn’t going to keep you from increased costs in the case of claims or accidents. If your insurance company has to pay out on a claim, they may raise your premium, regardless of how long you’ve been with the company.

Keep in mind that your insurance rates may not drop when you turn 25. While this one isn’t necessarily a myth, it is somewhat conditional. Insurance companies will focus more on years of experience, rather than chronological age when rating a driver. If a driver was licensed at 16, by 25 they have almost a decade of experience. However, someone who waited to get licensed until they were, say, 18 or 19 won’t see as much of a drop when they turn 25. Less experienced drivers represent a higher risk of accident, meaning that they cost more to insure and will pay a higher premium.

No fault accidents still affect your driving record and can affect your insurance premium by extension. Having a no fault accident doesn’t necessarily mean that you’re not at fault. With most insurance companies, what “no fault” means is that the involved insurance companies will pay for the injury-related bills for their policyholders, no matter who may be at fault. Accidents can still show up on your driving record, regardless of whether it was an at fault accident or not.

This is a newer myth, but one that is still worth busting. When buying your insurance policy, keep in mind that full coverage auto insurance won’t actually get you a new car in the event of a crash. Some auto insurance companies have instituted new programs where they will replace your car in the event that your car is totaled. However, that isn’t the case across the insurance industry. If you are unsure about just what is covered by your insurance policy, be sure to have your agent confirm the terms of your policy.

Hopefully this has helped to clear up some of the more prevalent myths that you may come across while shopping for auto insurance. If you have any questions, feel free to contact us at www.alexrue.com.