Insurance Myth Busting!
Time to do a little myth busting! When it comes to your auto insurance you will hear a lot of things that may or may not be true so we are going to go through some of the most well-known myths and misconceptions and see how factual they really are when it comes to the cost of your insurance!
The color of your car determines the cost of your insurance coverage.
BUSTED. Nope, the color of your car doesn’t determine the cost of your insurance coverage. The vehicle you’re driving, your age, marital status, credit rating, gender, and home address, do, however, determine the cost of your coverage. This in collaboration with what your “risk factor” is played into your coverage. They may check your driving record(accidents and tickets), how likely vehicle theft and break-ins are in your neighborhood to assess that risk.
The way you use your car determine your insurance rate?
FACT. The good news is that it doesn’t always mean that your rate will go up, sometimes how you use your car makes the rates go down. How you use your car also may determine the kind of coverage you have. Will you be commuting? Driving just on Sunday? Making some side money driving for Uber? If you use your vehicle for business, your personal policy may not cover you if something happens to your vehicle while on the job. Before you agree to purchase a policy, be sure to clarify these points with your agent. An additional policy or supplemental coverage may be in your best interest.
Insurance covers everything.
BUSTED. There are a variety of plan options, and depending on what you’re looking to spend you can even customize what you do and don’t want and how much coverage you want for each area. Remember that each state has different requirements about the minimum amount a policy must cover, so look into that before getting insurance.
Having insurance means you don’t have to pay anything!
BUSTED. As part of an insurance policy, a deductible is an amount you are contractually obligated to pay toward the cost of repairs, injuries, and damages that are incurred as part of a crash. The cost of the deductible is dependant on how much you are willing to spend for coverage. A deductible is generally part of Collision and Comprehensive coverage, though every type of coverage has a different deductible amount attached to it. In the event of a collision, you will be responsible for the deductible of whatever coverage included in your policy that you use.
To get a loan from a bank you need to have insurance.
FACT. Proof of certain types of coverage may be required for you to take possession of your new car. In addition to the usual types of coverage, your loan provider may also require you to have a gap policy. A gap policy accounts for the difference between how much the vehicle is worth and how much you still owe on the vehicle.
Your insurance doesn’t follow you to a rental car.
BUSTED. If you are renting a vehicle for pleasure and not for business, your personal policy should be transferable to the rental vehicle. The Insurance Information Institute recommends that policy holders check their personal health insurance and homeowners/renters policies, prior to renting a vehicle, because many additional options rental car companies may try to sell you may already be covered under those policies.
If this is your first time getting insurance, these are important pieces of information to know so it’s for the best that you can bust the myths and learn the truth. Long story short, when it comes to Auto insurance, you are 100% going to need it, but what you need is dependant on what you want to pay and what the state regulations are so check up on your state requirements and get yourself insured!