Auto Insurance Myths Debunked: What You Need to Know
Auto insurance can be a tricky subject, especially for younger car owners who may not have much experience with it. With so many misconceptions floating around, it’s important to know the truth and understand what you’re actually paying for. In this article, we’ll debunk five common car insurance myths and provide you with the facts you need to know.
Myth 1: Red cars are more expensive to insure
One popular myth is that red cars are more expensive to insure because they are more attractive and therefore more likely to be stolen. However, this is simply not true. Insurance companies base their rates on factors such as the make, model, year, body type, engine, and age of the car. The color of the car is not taken into account.
Myth 2: Insurance only applies when you are not at fault
Many people believe that insurance only applies when you are not at fault in an accident. In reality, insurance companies do cover accidents you caused through liability coverage. Adding collision coverage and medical payment coverage to your policy can also help cover costs if you accidentally cause an accident.
Myth 3: Insurance applies to regular repairs
Auto insurance does not cover regular wear-and-tear or normal breakdowns that come from the depreciation of your car. It is your responsibility to maintain your car and take it in for regular check-ups with a trusted mechanic. Reporting too many car problems to your insurance company may increase your premiums.
Myth 4: Insurance will pay post-accident values
When your car is totaled in an accident, the insurance company will calculate the car’s actual cash value (ACV) pre-accident to determine payout. They will not attempt to calculate the ACV post-accident. However, the insurance company may offer a lower payout than the Kelly Blue Book value of the car.
Myth 5: Auto insurance protects things inside your car
Comprehensive insurance may offer some form of theft coverage for your vehicle, but it does not cover the personal belongings inside your car. Homeowner’s or renter’s insurance may provide coverage for those items. If someone breaks into your car and steals your valuables, you will need to replace them on your own dime.
In conclusion, it’s important to understand the facts about your car insurance policy. Knowing what is covered and what isn’t can save you a lot of headaches down the road. Don’t hesitate to ask your insurance provider questions or shop around for a policy that better fits your needs. Remember, the cheapest plan may not always be the best option for you.