5 Car Insurance Myths You Should Know About

The most feared part of buying or leasing a new car is purchasing new car insurance. The process of signing up can get expensive, complicated, and no one really knows how the pricing works. This is particularly why there’s so much misinformation or myths about car insurance pricing, coverage, etc. Below, are the top five car insurance myths we debunked for you to share with others who are confused about basic car insurance facts.

Your regular policy covers you if you drive your car for business

Unfortunately, your personal auto insurance plan doesn’t protect you or your vehicle if you use it for work or freelancing purposes. For example, if you work for a pizza delivery company, you aren’t actually covered by the restaurant. If you get into an accident on the job, you are expected to take it up with your own insurance, which will more than likely deny your claim.

Insurance for red cars cost more.

Although there is still the tangible claim that red car owners drive more aggressive and are prone to speeding ticket, their insurance doesn’t actually cost more. Luckily, car insurance isn’t based on what color car you have or if you rent or own it. Instead, car insurance companies base your premium on the age, make, model, engine size, and the sticker price of your car, as well as your safety record.

However, other factors include the number of miles you regularly drive, where you drive and what kind of accident you have previously gotten into. Plus, credit history is another growing factor since people with a better credit history have shown to file fewer claims.

Soldiers are charged more for car insurance

Soldiers are actually charged less for car insurance due to their qualifying military discounts. However, you will need to provide documentation of your serving history and rank in the service.

Car insurance companies charge older drivers more

In fact, the opposite of this is generally true. Drivers who are 55 or older have the opportunity to reduce their insurance rates by up to 10 percent just by taking an accident prevention class. These classes help older drivers to brush up on their skills and stay safe on the roads. Plus, insurance companies like to see this sort of initiative and take it as a sign of commitment to safe driving. Before signing up for a course, check with your insurance company to find approved driving courses. Drivers who are retired or do not work full time can also qualify for special discounts. This is because they typically drive less than before. Look for these discounts and cheap car insurance online.

All damage is covered by your insurance policy

Sorry to burst your bubble but car insurance doesn’t work this way. Liability insurance provides coverage for if you injure someone or damage someone’s property. This insurance is required in certain states. Collision and comprehensive insurance covers your vehicle. This coverage is optional no matter where you live unless otherwise required in the terms of your car loan or lease.

If you want your car to be fully covered against all sorts of damage, you will need comprehensive and collision insurance coverage. This, however, may not be the best option for you if you have an older car. Cars that have a value of less than $1,000 or ten times the insurance premium are not worth buying this optional coverage for. It would be more cost effective to opt out of this type of insurance.

By learning all about these common myths and the truth behind them, you can be more informed the next time you are looking to buy car insurance. This way, you can use the resources available to you to get the best rates possible.