You probably already have a good idea about the factors that affect your car insurance premium rates and coverage. But how do you differentiate between truth and fiction? The Insurance Information Institute (I.I.I.). eight dispels common car insurance myths.
Myth 1. Color determines the price of car insurance
It does not matter if your car is red, green or purple. What matters is the type of car you select. Before buying a new or used car, check into insurance costs. Car insurance premiums are based on the make, model, body type, engine size, vehicle age, the age of the driver, driving record and credit history. They are also based in part on the sticker price of the car, the cost of repairing and its safety overall record, and the likelihood of theft. Many insurers offer discounts for features that reduce the risk of injuries or theft. These include daytime running lights and anti-theft devices.
Myth 2. It costs more to insure your car when you get older.
M all over 55 drivers can get discount auto insurance rates, usually for three years, if they successfully completed a course accident prevention. Insurance companies will generally provide up to a 10 percent on car insurance , but check with your provider before you sign on. mature driving courses are available through local agencies and state, as well as AAA and AARP. You can also check with your insurance agent to find out which defensive driving courses are approved by your insurer. If you are retired or are not employed full-time, you may also be eligible for a discount of up to 5 percent of your auto insurance. Age for this type of discount vary by state and vehicle insurance.
Myth 3. Your credit has no effect on your insurance rates.
Your insurance based on credit score is important. An insurance score is a measure of how you manage your financial affairs, not your financial assets. Many insurance companies take your insurance score into consideration when you want to purchase, change or renew your auto insurance coverage. Because most people have good credit, and insurance scores are derived from a person's credit history, most people pay less for insurance when insurance scores are entered the price equation.
Myth 4. your insurance cover if your car is stolen, vandalized or damaged by falling limbs, hail, flood or fire.
comprehensive and collision coverage are option covers. Lenders often require drivers to purchase a comprehensive and collision coverage as a condition of a car loan agreement. Those who drive older cars sometimes drop these coverages as a way to save money. If a car is worth less than $ 1000 or less than 10 times the insurance premium, purchasing the optional coverages may not be cost effective. But keep in mind, you need to purchase both collision and comprehensive coverage in order to fully protect your vehicle from all types of damage.
Myth 5. You do not have the minimum amount of auto liability insurance required by law.
Almost all states require you to buy a minimum amount of auto liability coverage. Chances are you will need more liability insurance than the state requires because accidents often cost more than the minimum limits. In the litigious society today, purchase the minimum amount of liability means you are likely to pay more out of pocket for losses incurred after an accident and the costs can be steep. The groups of the insurance industry and consumers generally recommend a minimum of $ 100,000 of protection of personal injury per person and $ 300,000 per accident.
Myth 6. If another person drives your car, its motor insurance cover if they get into an accident.
in most states, the auto insurance policy covering the vehicle is considered primary insurance, which means that the car insurance company for the vehicle must pay for damages caused by an accident. Policies and laws differ by state, and you should familiarize yourself with these differences when allowing another person to drive your car.
Myth 7. Soldiers pay more for insurance than civilians.
No matter which branch of the military you are, you are eligible for a discount on auto insurance. In some situations, you might be able to have your commanding officer make a phone call on your behalf, but for most auto insurance companies, you will need to provide documentation that lists your name, rank and the time you will be enrolled in the service. This allows insurance companies to determine how long you'll be eligible for a military discount. Many car insurance companies offer discounts for former members of the military and their families as well.
Myth 8. personal auto insurance covers both personal and business use of your car .
If you are self-employed and use your vehicle for business purposes, personal auto insurance may not protect you. While auto insurance tailored for companies can be more costly than a personal policy, one of the best ways to keep your auto rates down is to have a good driving record. If there are other people using your car, they must have good driving records too. Check the records of your employee drivers at least twice a year to ensure they maintain a good driving record.
For more information on saving money on car insurance go to the website of I.I.I ..
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