There is a lot of incorrect information floating around about car insurance these days. Some of it goes back a number of years while some of it has emerged with new technology. Where ever the information came from, it can cost you money (through increased premiums or lack of insurance coverage) if you are making decisions based on faulty information. So let's clear up some of the common car insurance myths once and for all.
1. The color of your car affects your insurance prices. NOT TRUE! Auto insurance companies base their rates on the safety features of a vehicle, the costs for repairs and other factors such as likelihood of theft. They also use driver information to determine rates, but they do not base rates on the color of the car. Most insurance companies don't even ask for the color of your car. Certain Makes and models generate more claims than others and therefor have higher insurance rates, but color is not one of the factors.
2. If I let someone borrow my car, they're responsible for any damage if they have an accident. NOT TRUE! In most situations, if you let someone borrow your car, your car insurance is going to extend to the person driving the car. In other words, car insurance typically follow the car, not the driver. So, if you let your friend borrow your car and they crash it into a tree, it will be your insurance company (and your deductible) paying for the claim! However, if your insurance gets maxed out, your friend's policy can be accessed for the additional costs.
3. My insurance company can cancel my policy or raise my rates at any time. NOT TRUE! In most states, insurance companies can only cancel your policy or raise your rates at the policy renewal (unless you are making changes to your policy that increase premiums such as buying a new car). Even if you have a couple of accidents, you will most likely not see the changes to your premium until the next renewal.
4. The laptop stolen from my car is covered under my auto insurance. NOT TRUE! Personal property (such as laptops) are not a part of your car and therefor notcovered under your car insurance policy. All personal items are actually covered under your property insurance policy, like you home or renters insurance. Unless something is physically attached and a permanent part of the car, there is no coverage provided under your car insurance policy. Your home insurance, on the other hand, extends some coverage to items that are in your car or any where else outside of the home.
These are just a few of the common myths about car insurance. If you base your insurance decisions on these or other myths, you may find yourself not buying the proper coverage or buying coverage you don't necessarily need. Talk to a local, professional agent - like Robert Edgin, 719-685-8585 - about your personal situation and get the facts about car insurance.
