Experts Dispel “Car Color” Auto Insurance Myth

When shopping for a policy, many potential customers tend to think of some popular auto insurance myths and how they could affect their coverage. These myths can determine how customers shop for a policy, what kind of coverage they receive, and how much they pay from premiums. A recent poll highlighted how these auto insurance myths can alter a customer’s perceptions. Experts with the Insurance Information Institute and a popular insurance quote resource told reporters about these myths and why some customers still believe in them.

Auto Insurance Myth: Car Color Choice Affects Insurance Rates

A very popular auto insurance myth states that the customer’s choice of paint color can affect their insurance quotes. One version of this myth claims that red or black cars are more attractive to thieves, which leads to higher auto insurance rates for cars with these paint schemes. A survey from an online insurance comparison site showed that 44 percent of Americans believed this auto insurance myth. In fact, many insurance carriers do not even ask potential customers about the car’s color.

Auto Insurance Myth: Coverage Does Not Include At-Fault Drivers

Some customers still cling to the auto insurance myth that they will not be covered if the insurer learns that an accident is their fault. Again, 44 percent of the survey respondents believed that their policy will not cover an at-fault driver. The fact is that most policies will cover some of the repair costs if the policy holder is found to be at fault for the accident. While the auto insurance myth of at-fault drivers losing their coverage is untrue, these drivers may expect to have their premiums raised. They may also have their coverage dropped if they are found to be at fault for multiple accidents.

Auto Insurance Myth: Auto Coverage Includes Items Stolen From Vehicles

One of the most prevalent auto insurance myths is that the auto insurance policy covers items stolen or damaged in vehicles. The survey showed that one-third of all respondents still believed this auto insurance myth. Although a typical auto insurance policy will cover damages related to theft, such as broken glass, the same policy will not cover any items stolen or damaged inside the car itself. Instead, policy holders should consult their homeowners or renter’s insurance policy for replacing items in their cars.

Auto Insurance Myth: Driving Record Is Most Important Factor

The biggest auto insurance myth going today is that carriers use the applicant’s driving record as the leading factor in calculating rates. Many carriers uses other factors, including location, repair costs and weather patterns, when establishing their premium rates. Many carriers use an applicant’s credit rating, more than their driving record, to set premiums. A recent study showed that several carriers granted lower rates to a hypothetical driver with good credit and a poor driving record, over a driver with a clean driving record and poor credit.

Source: CNBC

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NOTE: This blog post is a news story and is not an endorsement of Arguello Law Firm by any party mentioned herein.