As a driver in Corona, CA, auto insurance is a necessary expense that protects you and your family from potential financial losses in the event of an accident or other mishap on the road. However, there are several myths about auto insurance that can lead to confusion, misunderstandings, and even harmful mistakes. In this post, we’ll clarify some of the most common rumors about auto insurance and back up our arguments with statistics and research.
Myth #1: Red Cars Cost More to Insure
The idea that red automobiles cost more to insure is one of the most popular myths about auto insurance. The belief that flashy, high-performance vehicles in bold colors are riskier and therefore more expensive to insure has been around for decades. However, this myth is not true. Studies have shown that car color has no correlation to a driver’s risk profile or insurance premiums. Insurance companies determine premiums based on factors such as the make and model of your car, your driving record, and your location. The color of your car has no effect on these factors and therefore does not impact your insurance premiums. According to a study conducted by Insure.com in 2018, the most expensive cars to insure are luxury vehicles with high repair costs and expensive parts. These include makes and models such as the Mercedes-Benz S65 AMG, BMW M6 Gran Coupe, and Audi RS7. On the other hand, insurance costs are often lower for less costly vehicles like the Honda Odyssey and Jeep Wrangler.
Myth #2: Comprehensive Coverage Covers Everything
Another common auto insurance myth is that comprehensive coverage covers everything. While comprehensive coverage is an important type of auto insurance that protects against non-collision damage to your car, it doesn’t cover everything. Comprehensive coverage typically covers damage to your car that’s not the result of a collision, like theft, vandalism, or natural disasters. However, there are limits to what is covered. For example, comprehensive coverage does not cover damage that’s caused by regular wear and tear, or damage that’s caused by you driving your car with worn-out brakes. It’s really important to read and understand your auto insurance policy to know exactly what’s covered and what’s not. If you’re not sure, talk to your insurance agent to get clarification on your policy’s coverage.
Myth #3: Older Drivers Always Pay More for Insurance
Many people believe that older drivers always pay more for auto insurance. While it’s true that some older drivers may pay more for insurance, it does not always apply. In fact, some older drivers can qualify for discounts on their insurance premiums if they take a defensive driving course or have a clean driving record. According to a study by the Insurance Institute for Highway Safety (IIHS), older drivers tend to have fewer accidents than younger drivers and are less likely to engage in risky driving behaviors such as speeding or driving under the influence. However, older drivers may also face higher premiums if they have health conditions or if they drive less frequently. It’s important to speak with your insurance agent to understand how your age and driving habits may impact your premiums.
Myth #4: Your Insurance Premiums Will Always Increase After an Accident
Another common auto insurance myth is that your premiums will always increase after an accident. While it’s true that your premiums may increase after an accident, but it’s not a guarantee. Many reasons can impact whether your premiums go up, including the severity of the accident, who was at fault, and your driving history. Some insurance companies also offer accident forgiveness programs that allow drivers to avoid premium increases after their first accident. It’s important to speak with your insurance company to better understand their policies around accident forgiveness and premium increases.
Myth #5: Minimum Coverage is Enough
Another myth surrounding auto insurance is that minimum coverage is enough to protect you in the event of an accident. However, minimum coverage may not be enough to cover all of the costs associated with an accident, especially if you’re at fault.
In California, the minimum liability coverage required by law is $15,000 for injury or death to one person, $30,000 for injury or death to more than one person, and $5,000 for property damage. These amounts may not be sufficient to cover all of the expenses associated with a serious accident, such as medical bills, lost wages, and property damage.
It’s important to evaluate your personal financial situation and driving habits when deciding how much auto insurance coverage you need. To further protect yourself in the case of an accident, think about upgrading your liability limits or buying extra protection like collision or comprehensive insurance.
Myth #6: Credit Score Doesn’t Impact Your Premiums
Many people believe that their credit score has no impact on their auto insurance premiums. However, studies have shown that there is a correlation between credit scores and insurance premiums.
According to a research by the Federal Trade Commission, drivers with low credit scores may pay up to 91% more for auto insurance than drivers with high credit scores. This is because insurance companies use credit scores as a factor in determining a driver’s risk profile and likelihood of filing a claim. If you have a low credit score, it’s important to work on improving it to potentially lower your auto insurance premiums. Paying bills on time, reducing debt, and correcting any errors on your credit report are all of the steps you can take to improve your credit score.
Auto insurance is a complex topic that is often shrouded in myths and misunderstandings. By clarifying some of the most common auto insurance myths, we hope to provide Corona, CA drivers with a better understanding of their coverage options and how to best protect themselves on the road.
Remember that when it comes to auto insurance, it’s important to read and understand your policy, evaluate your personal financial situation and driving habits, and talk to your insurance agent to get the coverage that’s best for you.
Throughout this article, we have provided data and studies to support the information in this article. It’s important to understand the facts and figures about auto insurance in order to make the best decisions about your coverage.