Insurance can be confusing, and sometimes when people get confused they give you the wrong information, and sometimes this information gets passed on and on and on until lots of people believe it to be true. That’s what has unfortunately happened in the case of car insurance myths. There’s plenty of bad info out there about car insurance, but here are the worst offenders:
- The color of your car affects your insurance rate – This just isn’t true. There are many, many factors considered when setting a rate for car insurance like make, model, or year, but the color of your car will never cost or save you any extra money.
- The more your car costs, the more your insurance will cost – This one definitely makes sense, and it can be true, but this isn’t the rule. Insurers will often look into their records and see how many claims they’ve paid out on a particular model, the more claims the higher the rate and vice versa. Because of this, a cheaper model of car that has had more claims with a company could have a higher cost to insure than a more expensive model with less claims against it.
- You got a speeding ticket, your rates are going to shoot up – Tickets and moving violations can cause your rates to go up, but it isn’t guaranteed. A minor ticket with an otherwise clean driving record isn’t very likely to increase your premium. It’s also possible for you to purchase accident forgiveness for your auto plan. This would help prevent your premium from going up even after a minor accident where you were at fault.
- If your friend crashes your car, their insurance will cover it – When there’s an accident, it’s about the car’s insurance, not the driver’s. If your friend is driving your car (with your permission) and gets into an accident, the claim will always go through your insurance, not the friend’s, so be careful when lending out your vehicle.
- Smaller cars are cheaper to insure – In reality, the opposite is typically true. The size of your car doesn’t factor into the price of your coverage. On top of that, the cheapest cars to insure are typically small to mid-size SUVs. This isn’t due to size however, small cars can be more expensive to insure because they tend to be driven by young or inexperienced drivers who make more claims, and because passengers injured in small vehicles often have higher injury claims.
- If you cause a bad accident, your insurer will just drop you – It goes without saying that you should always try to avoid accidents. Accidents do happen though, and the last thing you should be worrying about after is if your insurer is about to cancel your policy. State laws do not allow insurance companies to drop you in the middle of your policy term. Your insurer could only drop you mid-term if you had missed payments or committed fraud. Outside of this, your insurer can’t just cancel your policy. They can non-renew you, however, but this happens when it’s time to renew your policy, so coverage wouldn’t stop without warning.
- “Comprehensive” car insurance will cover everything – It’s understandable to think this, but comprehensive auto policies cover specific things, not everything. Comprehensive policies don’t cover actual car crashes, but other situations where your vehicle is damaged. These could be:
- Natural Disaster (Tornado, Hurricane)
- Damage Caused by Animals
- Falling Objects
If you have any more auto insurance questions, or need to make some policy changes, contact an agent below!
Vice President | Voluntary Benefits
Eric Labo is a Vice President, Voluntary Benefits Consultant at RogersGray Insurance. In this role, Eric works with regional employer groups and their human resources teams to provide employees with high-quality voluntary benefit solutions, including personal insurance products, vision, short term disability and more. Eric resides in the Plymouth area with his wife, their daughter and their dog. You can connect with Eric on LinkedIn or by email.