What are some of the top myths about car insurance and auto insurance that are not actually entirely true?

Especially with popular subjects, there are often incorrect myths that often circulate and float around. We would love to address six such myths about car insurance, because knowing the correct information can help people make the proper informed decisions.

Myth 1: Certain colored cars, for example red, are more expensive to buy car insurance for versus other, more neutral colors.

This is a common notion that floats around; in fact, in a recent survey of car insurance buyers, around 1 in 4 drivers actually believe this. In most cases, however, car insurance companies do not even ask about the color of the car when determining rates on a car insurance policy. Car insurance companies care more about the year, make, model, and condition of the car you want to insure, as well as the information about the driver. The driver’s driving record, age, sex, and credit report also have a great impact on the rate one will pay for the auto insurance policy.

So, your car insurance company will care more about how you drive and what car you drive in terms of year, make, model, and what is under the hood. There is no need to go repainting your car to a more neutral color from flashy red before getting an auto insurance quote.

Myth 2: Sports cars are more costly to insure since drivers of those types of cars get into more accidents and get more traffic tickets and moving violations.

In general, that might actually be correlated figures; however, as in many cases, correlation does not prove causation. According to a recent study delved into higher car insurance rates resulting from higher numbers of accidents and traffic violations attributing to driving a sports car. The study found that there were plenty of sports vehicles whose drivers tended toward defensive and safe driving. There were also plenty of non sports cars whose drivers tended to be on the higher end of traffic tickets, accidents, and violations resulting in higher auto coverage fees.

In this case, sports car insurance policies are actually not even the highest rate payers in the industry. That distinction usually belongs to car insurance policies covering vehicles made by Hummer. In the end, looking more beneath the surface of just what type of car they drive, the actual car insurance rates depend also greatly upon the driver’s driving record. There are plenty of good and bad drivers that both either drive or don’t drive a sports car.

Myth 3: If my car has a problem being damaged or stolen, then my car insurance company will cover the costs of renting a car.

This is a common belief, but the fact is that most auto coverage policies do not, by default, cover the cost of a car rental should your car become inoperable for some reason of damage, accident, or theft. Having car rental coverage is actually an option that you can get fairly inexpensively with most car insurance companies. This option usually only costs a couple dollar a month to add on. Another fact you should be aware of is that even if you do have car rental coverage there is usually a limit on you are allowed to spend per day for a car rental as well as a maximum cap on the total car rental coverage per incident. This means that you might reach your maximum cap for the car rental coverage before your car is recovered in a theft or repaired in cases of damage or collisions.

Myth 4: If I total my car in an accident, my insurance policy will cover my car loan or car lease remainders.

False, car insurance policies will usually cover you for the current value of the car, irregardless of how much your remaining car loan or lease remainder is. It is a simple matter of fairness; think about how you would feel if your car paid off your $1 loan for your $5000 value car should you get into an accident. So, bear this fact in mind and know that you will be covered for the value of the car. In most cases, if the cost to repair your car exceeds 70% of the value of the car, the car insurance company will forgo repairing the car, declare it totaled, and cut you a check for the value of the vehicle.

Myth 5: If someone has auto insurance coverage, and there is a problem with his car such as being damaged, stolen, accident, or able to be driven, then the insurance company will automatically all these cases.

You cannot assume that all cases and damages will be covered for your vehicle unless you opted for comprehensive coverage. In fact, the auto insurance policy that most people buy only cover the minimum of what is required in terms of liability coverage for their state. These simple policies actually only cover any damage that you might do to others. There are also other options for the car insurance to cover collision and comprehensive coverage. Collision coverage covers car accidents, and comprehensive coverage covers all other types of damage your car might undergo outside of auto accidents.

Myth 6: Thieves who steal cars prefers to steal those shiny, brand new cars versus older cars.

This is actually the opposite, where study have shown that thieves actually prefer to steal older vehicles. This is due to the fact that in most cases they are easier to steal with fewer alarms or security. Also, most stolen cars are not sold off whole; they are chopped up for their parts, and older parts may be easier to sell.