Caring makes the difference when it comes to understanding your auto insurance. This blog post tackles nine common myths surrounding auto insurance, helping you separate fact from fiction and ensure you have the right coverage for your needs. Being an informed consumer is crucial for protecting yourself financially.
Auto insurance can be complex, and several misconceptions can lead to inadequate coverage. Understanding the truth behind these myths is essential for every responsible car owner.
1. Totaled Car, Paid-Off Loan? Think Again.
Insurance companies typically pay the Actual Cash Value (ACV) of your car before the accident, not the remaining loan balance. If you owe more than the ACV, you’ll likely be responsible for paying off the difference, even if your car is totaled.
2. “Full Coverage” Doesn’t Cover Everything.
No auto insurance policy covers every possible scenario in full. Policies have limits on what they will pay for damages, and even “full coverage” won’t cover the cost of replacing your vehicle if it’s totaled – you’ll still only receive the ACV.
3. Red Cars and Higher Rates: A Colorful Myth.
The color of your car does not affect your insurance rates. Factors like speeding tickets, driving record, and type of vehicle are what influence your premiums. The red car myth likely originated from the misconception that drivers of red cars are more prone to speeding.
4. Anyone Over 25 Can Drive My Car? Not Necessarily.
Your auto insurance policy typically covers only listed drivers and those with explicit permission to drive your vehicle. Allowing someone not listed on your policy to drive your car could jeopardize your coverage in case of an accident.
5. Post-Accident Insurance? Doesn’t Work That Way.
Insurance is designed for unforeseen events. Purchasing insurance after an accident will not cover that incident. This is akin to buying a lottery ticket after the numbers have been drawn.
6. Friend’s Insurance Covers My Car? It Depends.
Whether your friend’s insurance covers damage to your car while they’re driving it depends on your state’s laws. In some states, the at-fault driver is responsible for reimbursing the insurance company.
7. Stolen Property in My Car? Not Covered by Auto Insurance.
Your auto insurance policy covers your vehicle, not personal belongings inside it. For items stolen from your car, you’ll typically need to file a claim with your homeowners or renters insurance.
8. Non-Owners Insurance: Not Always Necessary.
Most auto insurance policies provide coverage for the policyholder when driving other people’s cars. Non-owners insurance might be necessary in specific situations, but it’s not a universal requirement.
9. Teen Drivers and Liability: You’re Responsible.
Parents are generally responsible for their children’s actions, regardless of whether the teen is listed on their auto insurance policy. Listing your teen driver on your policy doesn’t create liability; it simply provides a means of paying for that pre-existing liability.
Don’t let these myths leave you underprotected. Contact us at Parkway Insurance Group, Inc. today to discuss your auto insurance needs and ensure you have the right coverage. Call us at (281) 558-1991, email us at info@parkwayinsurancegroup.com, or visit our website at www.parkwayinsurancegroup.com. We’re here to help you navigate the complexities of auto insurance and find the best solutions for you and your family.
Disclaimer: The content provided is for informational purposes only and should not be considered financial or insurance advice. It is essential to consult with a licensed insurance agent or financial advisor to determine the best coverage options for your individual needs and circumstances.
