Car insurance is a touchy subject when it comes to most people, especially those who use their cars for everyday activities. However, what most drivers fear more than dealing with the costs of insuring their vehicle, is uninsured drivers. Not only are they more likely to cause accidents, but they face difficulties when it comes to fixing the damage they caused.
So in this day and age, it is vital to have car insurance. However, you need to make sure you make the right decision and don’t just rush into things, picking the first thing that catches your attention. First, you need to see what misconceptions to steer clear of in order to make smart decisions:
1. The idea of full coverage means that you’ll get a new car if you crash your current one.
This is not only foolish, but also highly dangerous to believe. It can even lead to people purposely crashing their cars in the hopes they’ll get a new, better one instead. What most people seem to misunderstand is what the term “full coverage” actually means.
If your insurance agent says your car insurance grants full coverage it doesn’t mean you’ll be eligible to get a new car if you are in an accident. The point of insurance is to help get you back where you were before the accident, not improve your condition. So, in short, full coverage means the insurance company will be paying for the repair expenses to get your car up and running.
2. The price of the car insurance is determined by the color of the car.
Not at all. While there are people who think that a color, such as red for instance, will raise your insurance rate, it doesn’t mean it’s true. Sure, police officers will have an easier time spotting your red car if you are speeding, but insurance companies won’t care about it.
[ Photo Credits: Draco2008’s Flickr ]
In order to properly establish insurance rates, insurance companies are more interested in taking a look at what model your vehicle is, how large the engine is and what year it was manufactured.
3. Credit score doesn’t influence insurance rates.
Besides your driving record, your credit score is actually one of the first things car insurance agents look into. Why is this? Because it tells them how trustworthy and reliable you are when it comes to affording and paying loans, meaning they’ll have an easier time believing you’ll be able to handle the insurance rates.
4. Car insurance covers personal objects in your car.
Once again, this is false. If someone breaks into your car and steals a laptop or it gets damaged in an accident, the car insurance company won’t cover it. Remember that auto insurance is meant to pay for any damages your car sustains, so that you’ll be able to use it again.
It’s not intended to cover any personal objects that might get damaged as well. This is more or less what home insurance does.
5. Getting a ticket means your insurance rates will go up.
Not necessarily. It all depends on the severity of the ticket and your driving record. If your record is clean and the ticket is minor, then you have nothing to worry about. However, if it’s something serious, then your insurance rates will probably sky-rocket.
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