For any car owner, buying automobile insurance is essential. Having this protection will keep you from entering financial hardship following an accident. Unfortunatly, there are plenty of myths floating around about car insurance options and insurance companies. This guide will debunk some of the most common car insurance misconceptions.
Myth: Owning a red car will hike up your insurance rates.
Fact: The simply truth is that color will not effect your car insurance rates. Perhaps perpetuated by the speedy sports car stereotype, this myth is especially common among young drivers. Insurance companies are more likely to consider the make, model, and age of your car.
Myth: Older drivers have higher insurance rates.
Fact: The opposite is actually true. Older drivers may qualify for reduced insurance rates, particularly if they are over 55. Talk to your insurance agent to see if you qualify for this type of program.
Myth: You can escape premium hikes if you don’t report your accident.
Fact: About 6 million car accidents occur in the United States each year. If you happen to be in one of them, you may think that you can hide it from your insurance company. The truth is, however, that the company will likely find out when the other driver files a claim. So, it’s best to report it in the first place.
Myth: If your car is broken into, insurance will cover the lost property.
Fact: Not necessarily. This depends on the specifics of your automobile insurance policy. Lost property due to car break-ins are often covered under homeowners insurance, so check this policy as well. And of course, take measures to protect your car against break-ins.
Myth: Your financial history will not impact your insurance.
Fact: Some aspects of your money management history may impact your rates. Insurance companies often have the right to look at your credit score in particular. If you are worried about having high premiums due to a poor credit score, consider working with a financial planner to talk through your options.
Purchasing car insurance is an essential part of owning a car. And by understanding the facts behind different insurance plans, you can make a well informed decision. Remember that the best way to understand your options is to talk to an insurance professional directly.