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7 auto insurance myths debunked

By July 1, 2018March 4th, 2022No Comments
7 auto insurance myths debunked

Personal auto insurance can be confusing. There’s a lot of misinformation out there, and you may think you are covered when in fact, you’re not. Hopefully, we can help to separate some of the myths from fact. Here are some of the more popular myths about auto insurance.

MYTH #1- Drivers of red cars get more tickets.

You may be surprised to hear that vehicle color is NOT used in setting car insurance premiums. Factors that DO affect your auto insurance rate include: Your age, gender, driving record, insurance claims history, marital status, where you live, vehicle make, model, year and engine type, annual mileage, how you use it, average cost to repair/replace the vehicle, its popularity with car thieves and believe it or not, your credit score (in most states.)

MYTH #2 – My premium will rise if I get a ticket.

Getting a ticket doesn’t necessarily lead to an insurance premium increase…it’s the type of violation you committed that determines this (in some cases just one speeding ticket may do the trick.) But your premium may not increase if the infraction was minor, and you have a clean driving record. Plus your insurance policy may also offer accident forgiveness.

In addition, there’s a chance that your insurance company would not know you got a traffic ticket after purchasing your auto insurance policy. The reason: They usually pull your driving record when you purchase your policy, and unless you make changes, file a claim, or switch providers, they generally won’t pull it again without a reason.

MYTH #3 – An expensive vehicle costs more to insure.

The sticker price is NOT the main factor in determining your auto insurance premium. Factors that matter most include the cost to repair/replace the vehicle and how well the vehicle performs in crash tests.

MYTH #4 – You let someone borrow your car, so they will be responsible in the event of an accident.

With personal auto insurance policies, the insurance follows the vehicle, NOT the driver. So if you let a friend drive and they get in an accident, it’s YOUR insurance, NOT theirs, that will cover the damages for the property liability and damages.

MYTH #5 – It costs more to insure your car when you’re younger.

It’s true that the highest average premiums are typically charged to those age 16-19, followed by those age 20-24, then age 25-29. However, around age 70 the rate factors do increase again.

Maintaining a clean driving record at any age will also keep your auto insurance rates lower as well. Statistics show that car accidents are the leading cause of death for people aged 16-20, while less than 1% of people aged 65 and older die in motor vehicle accidents. The elderly also tend to drive slower (resulting in fewer high speed accidents) and they tend to drive fewer miles annually, resulting in lower premiums.

MYTH #6 – Personal auto insurance also covers business use of your vehicle.

Personal auto insurance policies may provide coverage for some business use of a vehicle (things like work-related errands, customer visits and an occasional delivery,) and the vehicle must be rated and approved for business use by the company. It will NOT provide coverage if the vehicle is used to transport people or goods for a fee, if it is owned by a business or if it is primarily used for business purposes. In addition, business use is generally restricted to passenger cars, pickup trucks and vans (vehicles not covered include commercial vehicles like box trucks, shuttle buses and multi axle vehicles.)

Some insurance company policies may restrict all business usage, so it’s important to contact your insurance agent to see what limitations your personal auto insurance policy has before using your vehicle for business purposes.

MYTH#7: Comprehensive auto insurance covers me if someone steals a personal item from my car.

Comprehensive insurance covers damage to your vehicle. In the event of a break-in, damage to things such as locks, windows, your glove box and ignition lock switch would be covered.

It’s your homeowner’s or renters insurance that would likely pay for stolen personal items (such as a laptop, tools, sports equipment, purse, iPhone, iPad or expensive sunglasses.)

Exactly what is covered and how much compensation you will receive for the stolen items varies between insurance companies and policies. Some companies now give a little coverage for personal effects in a vehicle at time of loss, so it’s important to check with your insurance agent to see how you would be covered if your vehicle is broken into and personal items are stolen.

If you have any auto insurance questions, or if you’d like to learn more about auto insurance options in the Lehigh Valley, please contact us. We can help ensure that you have the insurance coverage you really need.

Arbor Insurance Group provides auto/car insurance, home insurance, life insurance and other personal insurance products throughout the Lehigh Valley, including Allentown, Bethlehem, Easton, Emmaus, Macungie and surrounding areas.

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