Top 10 Auto Insurance Myths

The color of my car determines my auto insurance rate. My credit score has no bearing on my insurance premium. I have auto insurance coverage so my new car is already covered… right?

Maybe not! Below is a list of fallacies many car owners believe and drive by each day. The truth just might make you change course.

Myth #10 "No-fault insurance means it's not my fault!"
False. No-fault insurance means that your insurance company pays for your damages regardless of who's at fault.

Myth #9 "The color of my car affects my insurance rate."
False. The color of your car does not impact your car insurance rate. What does influence your rate is your vehicle's year, make, model, body type, and engine size, along with your credit history and driving record.

Myth #8 "If I lend my car to a friend and that friend is in an accident, his or her insurance company will pay for the damages… right?"

False. Your car, your responsibility! And guess what, even though you weren't present at the time of the accident, you still will receive a mark on your insurance record and your insurance premium could possibly go up.

Myth #7 "My insurance rate is set by the government."
False. The government does not set your car insurance rate. Where you live, your credit score, marital status and your driving record is what actually affects your premium.

Myth #6 "I recently paid my insurance premium, so the new car I just purchased is covered."
Not necessarily. Most automobile policies require that the policyholder notify the insurance company or agent within a specified number of days, if indeed coverage is desired for the newly purchased vehicle.

Myth #5 "It's a fact. Males under the age of 25 pay more for auto insurance."
True and False. Males under 25 years old can potentially pay more for car insurance than female drivers. However, across the board, teenagers and seniors pay more for auto insurance, in large part because these age groups are typically involved in more automobile accidents.

Myth #4 "My credit score has no effect on my insurance rate."
False. Your credit score really does matter! Many Insurance companies take your credit score into consideration when deciding to increase or renew your auto insurance coverage.

Myth #3 "Even without comprehensive coverage, I'm still covered for theft, windstorms, hail and deer accidents."
False. Many drivers believe that if they only purchase collision insurance-which covers damage to your car resulting from driving accidents--that they will also be covered for incidents that involve vandalism, hail, animal accidents and fires. That simply is not true. You need to purchase both collision and comprehensive coverage in order to fully protect your vehicle from all of these situations.

Myth #2 "My personal auto insurance covers both my personal and business use of my car."
False. If you occasionally use your personal car for business purposes such as transporting clients, going to and from meetings or hauling business equipment, then you will more than likely need to extend your personal car insurance to cover your business use as well. Plus, if your employees use their car while working for you, you will want to also obtain a separate non-owned car insurance policy.

Myth #1 "I've never had or been involved in a car accident, so I don't need automobile insurance."
False. Some drivers are lucky enough never to have been or to be involved in an accident. However, car insurance is the best protection you can have in the event of an automobile accident. It's also a legal issue. You are legally required to have some form of auto insurance, and failing to do so carries some fairly strict punishments.

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