Insurance can get a little complicated. If you’re dealing with your car insurance, you might be operating under certain assumptions that are widely believed to be facts…but that maybe aren’t as true as you think they are. It’s important that you’re equipped with all the facts when you handle any type of insurance, so we’re going to debunk 13 popular car insurance myths. Let the debunking begin!
Car insurance myths: Debunked
1. Myth: Red cars are more expensive to insure.
What’s the truth? This one is a classic myth and widely-held belief, but it’s actually not true. Red cars do not cost more to insure than cars of other colors. The logic behind this myth is that the type of person who wants a red car is more of a risk-taker, meaning they’re more likely to speed and drive recklessly, leading to more tickets. But the insurance company really doesn’t care about the paint job your car has – they care about how safe the vehicle is. They want to know the make, model, year, and so on.
So, don’t let this myth hold you back. If you really want that fire-engine red car, go for it. Don’t let car insurance myths get in the way.
2. Myth: Your car insurance will repair or replace your car if you’re in an accident.
What’s the truth? If your car is damaged, your car insurance will only pay to repair or replace it if you have collision and comprehensive coverage. Collision coverage can repair or replace your car if you’re at-fault in an accident. Comprehensive coverage can pay to repair or replace your car if something other than an accident (fire, animal strike, vandalism, falling objects like trees) damages it.
If you only have liability coverage, your insurance will only pay for your legal obligation to the other driver in the accident – their medical bills, lost wages, car repairs or replacement, and so on. You would be out of luck when it comes to the repairs to your own car.
3. Myth: Comprehensive insurance covers mechanical repairs.
What’s the truth? Unfortunately, this is one of those car insurance myths that is blatantly false. Comprehensive coverage will cover losses such as fire, vandalism, animal strikes, and objects that randomly crash from the sky (like trees.) It even covers theft. But a whacky transmission? Nope. You’re on your own.
4. Myth: Belongings stolen from the car are covered under auto insurance.
What’s the truth? It’s actually your home insurance or renters insurance that might help you out here. But you have to consider your deductible.
5. Myth: It’s less expensive to get insurance online.
What’s the truth? The Internet is useful for a lot of things. Your car insurance? Well, maybe not so much. There are lots of advantages to working with an actual, real-live person. A good, trustworthy insurance agent can help you make sure that you’ve got the coverage you need to fully protect your vehicle and your liability. They can make sure you’re not underinsured, which means that you won’t be diving between the couch cushions for change if you have a claim.
If you buy insurance online but don’t get high enough limits of coverage, you could be facing a huge financial loss if you’re in a bad accident. Besides, that computer can only go so far in understanding your unique insurance situation. Real agents can take the time to get to know you – and another cool trick? They can help you get car insurance discounts. Bonus!
6. Myth: The insurance company only looks at my driving record – my tickets and accidents.
What’s the truth? Insurance companies look at many details about you and your vehicle to determine your car insurance rates. They consider your age, the car you drive, what the car is primarily used for, how many miles you drive, and your credit score. So, as you can see, it’s way more than just your driving record. (Although of course being a safe driver can help you avoid accidents and keep your car insurance rates down.)
7. Myth: Smaller cars are less expensive to insure.
What’s the truth? Well, it depends on the coverage you have on it. If you have collision and comprehensive coverage, it could be a bit pricier because a small vehicle will sustain more damage in an accident than a larger vehicle. Think about what would happen if a two-seater convertible rear-ended an SUV.
8. Myth: If I total my car, insurance will pay the rest of the amount on my loan.
What’s the truth? Not quite. The insurance company will pay the actual cash value (ACV) of the vehicle at the time of the accident – well, less your deductible, which you have to pay. The problem is that the ACV of your vehicle might not be enough to cover the rest of what’s left on your loan since car values depreciate so quickly. If you owe more on your loan than the vehicle is worth when you have an accident and total the car, you would have to pay the difference. You would need gap coverage to fill this difference.
9. Myth: A car that cannot be driven away from an accident is totaled.
What’s the truth? The insurance company decides if the car is totaled based on the amount of damage it sustained. If the amount for the repairs is above a certain percent of the value of the car, it could be declared a total loss.
10. Myth: An out-of-state ticket can’t follow me back to my state.
What’s the truth? Actually, it can. And it will. Just because you were in Tennessee for the weekend does not mean the ticket you got in Nashville goes away the second you cross the Georgia border. That ticket will be with you.
11. Myth: Newer cars cost more to insure.
What’s the truth? Your insurance rate really depends on the car itself. Your premium depends on the year, make, and model of your new ride.
12. Myth: I shouldn’t worry about my old car getting stolen. No one’s going to take it.
What’s the truth? Actually, old cars are often targets of theft. It seems a bit backward, but car thieves can get more money for car parts coming from older-model vehicles. Who would have thought? And besides, it’s usually easier to steal an older vehicle, and car thieves are looking for the easy take. Your car may have many miles on it and a few scrapes and dings, but that doesn’t mean you shouldn’t take steps towards preventing a car break-in or theft.
13. Myth: The state minimum level of car insurance is fine.
What’s the truth? This is perhaps one of the most dangerous car insurance myths out there. You will probably want to get more than the state minimum level of insurance. Georgia’s minimum limits of auto insurance are $25,000 bodily injury per person, $25,000 property damage liability, and $50,000 of bodily injury per accident (meaning all people in the accident.) Yes, at first glance that seems like a lot of money. But if you’re in a very bad accident and you end up getting sued, that amount suddenly looks much, much smaller. You will probably want more liability coverage than the state minimum to fully protect yourself financially.
(And Georgia does not require collision or comprehensive coverage, which will pay to repair or replace your car if it’s damaged. If you only have the state minimum requirement, that’s just liability coverage. Should something happen to your beloved car, you’d be out of luck.)
As all of the above car insurance myths show us, not everything you hear or assume about car insurance is true. It’s important to get all the facts from a trusted insurance agent and advisor. Our team here at Atlanta Insurance would love the opportunity to become that trusted advisor to you. We can answer your car insurance questions and help you shop for the best insurance at the best rate. We’ll go over your coverage options with you so you know you’re getting good intel (and not just car insurance myths.) And we’ll help you save money on car insurance. Get in touch by filling out our online quote form or giving us a call today.