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Car Insurance Myths

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When it comes to auto insurance sometimes we are taught things that simply are not true. Let’s look at some of the most common misconceptions about auto insurance:

No Fault insurance means it is not my fault.

This is not true, no-fault insurance means that no matter who is at fault your auto insurance company pays for your damage in a wreck.

The color of my car affects my insurance rate.

Actually, the color of you car has no affect on your insurance rate. What does affect your rate is the year, make, model, body type and engine size of your car as well as your personal credit history and driving record.

If I let my friend borrow my car and he has an accident then his insurance company will cover all the damage, right?

Nope. If it’s your car, it’s your responsibility. And the news gets worse. Even though you weren’t there at the time of the accident, you will get a mark on your insurance and your insurance rates will most likely go up.

Is my insurance rate set by the government?

No, the government has nothing to do with your car insurance rate. Where you live, your credit score, marital status and your driving record are the things that affect your insurance rate.

I just paid my insurance premium, so the car I just bought is covered.

Not necessarily. It is required that the policy holder notify the insurance company within a matter of days of getting a new car in order to make sure the new vehicle is insured. It is most advisable to call them before you make the purchase, to assure they will cover the vehicle you are going to buy.

It is a fact that males under the age of 25 pay more for car insurance.

Yes and no. Males under 25 will pay more for car insurance than females will. But, teenagers and younger adults will pay even more for car insurance because they are in the high risk age group.

My credit score has no affect on my auto insurance.

That is false. Your credit score really does matter. Many insurance companies will do a credit check when you are taking out a policy with them.

Even without comprehensive coverage I am still covered in theft, windstorms, hail and deer accidents.

That is not true. You will need to purchase comprehensive coverage in order to fully protect you car.

My auto insurance covers all the times I use my car for business.

Not true. If you are going to use your car for business you may need to upgrade your insurance policy to cover that. If you are going to let people that work for you drive your car you also need to add that to your insurance policy.

I have never been involved in an accident so I don’t need auto insurance.

Even if you’ve never had an accident, you are required by California law to have auto insurance on your car. If you don’t, you could face criminal penalties. You may be lucky by not having an accident but if you are involved in an accident and you don’t have insurance then you will certainly see how unlucky you can be. It is always best to be protected. Contact Cost-U-Less today for a free quote.