Regarding auto insurance, there are many myths floating around. Over the years I have heard many reasons why someone believes their insurance rates should be lower (or higher), and many of them are fake. Regardless of how these misconceptions have started, they are deeply rooted in the lore insurance. Below, I bust the four of the most common myths about auto insurance that I encounter on a daily basis.
- I have a red car, so I know that it will cost more money. You can have a red car, green car, car or magenta - the color does not affect your insurance. The year, make and model are all that matters regarding what your insurance will cost for a particular vehicle. There are many other features on the car can affect your insurance rates as well, but the car color is not one of them.
- I am over 25 years, so my insurance should be cheaper. People often think that when they reach a certain age their insurance rates should be automatically reduced. The reality is that each insurance company imposes tariffs which are based on the age of the driver. Some companies use the driver's age, but others assess how long you've been a licensed driver. Because of this gap in the industry, there is no magic age where your rate will start to fall. In general however, young drivers pay higher premiums than the average age of drivers and older because younger drivers have more accidents.
- My car is old, so I want the minimum insurance coverage. Just because your car has seen better days does not mean that you should wear low liability limits. The fact is, you can be involved in an accident and injure or even kill someone with a clunker just as easily as you can with a new car. People often assess how much they want to spend on insurance based on the value of their car. Most covers on an insurance contract with injuries you receive or injury you cause to others. Having a vehicle not beat it less likely that you will be injured or injure someone in an accident. You can decide not to buy coverage to repair or replace your car, but always carry as much liability coverage and medical payments you can.
- I do not have an accident last year and my car is a year older so my rates should fall. Being accident-free and having a car that is a year older does not automatically correspond to a lower insurance premium. Premiums increase based on a variety of factors, including the cost of repairs, the cost of your vehicle, etc. Many people think that their insurance should continue to decline due to age of the vehicle and have no accidents or speeding tickets. However, inflation has the same effect on the insurance he has on a gallon of milk. The age of your vehicle is not to pay less money body shop to fix your car or to obtain parts for these repairs at a price because your car is older (like getting milk from a older cow costs no less!). The cost of insurance terms of the overall cost of your insurance claim in general, which includes the hourly rates for body shops and mechanics, auto parts and even lawsuits resulting from accidents, among other things. The more your mechanical loads for repairs or your legal fees to defend you, plus the cost of insurance.
The truth is, car insurance varies from state to state. To get a better understanding of what factors in determining auto insurance rates in your state, contact your operator or agent for details.
What other myths have you encountered when it comes to insurance? I may be able to bust those as well!
The automobile insurance coverages described above are in the most general terms and are subject to conditions and actual policy exclusions. For the actual wording cover, conditions and exclusions, refer to your policy or contact your independent insurance agent.
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