America was built on mobility. So much of our nation’s identity is linked to the freedom of open road driving and all that comes with it. From iconic drives like Route 66 to scenic drive-in movie theaters, there is an undeniable mythology that has formed around cars. The auto industry even helped create and transform countless American cities, forever linking our culture with the automobile. Of course, that mythology isn’t always romantic. Some of the most common myths about cars, insurance and driving can be downright confusing. Considering how few people actually read through their auto insurance policy, it’s no wonder there are so many misconceptions about coverage. Keep reading to explore five of the most common car insurance myths.
Auto Insurance Myths
Myth #1: Red cars cost more to insure.
When you picture a red car, chances are good your mind goes to a sports car with a high-powered engine and daredevil driver. The reality? Plenty of cars just happen to be red. Red minivans, crossovers and sedans are driven daily by people who have no real preference for their car’s color. That’s why this car insurance myth doesn’t hold water. While it’s true that thrill seekers might have a penchant for the color red, the shade itself isn’t linked to higher insurance premiums. Those risk-takers who drive red cars and pay a pretty penny for insurance may have a history of getting into accidents or caught speeding, driving up their premiums and giving all drivers of red cars a bad reputation.
Myth #2: Car insurance covers vandalism and theft.
You can’t keep a constant eye on your vehicle, especially when you’re parked in public. Unfortunately, cars are subject to vandalism and theft. Dents, broken windows and keyed paint happen to many drivers at some point in their lifetime. While you might assume that your auto insurance policy will cover the costs associated with repairs, that’s not always the case. If someone smashes your side mirror, for example, you might be tempted to file a claim. Even with comprehensive coverage, you’ll likely need to pay a deductible. In many cases, the deductible will cost more than the repair itself.
Personal property stolen from a car isn’t necessarily covered by your car insurance, either. If your laptop is stolen out of your backseat, you’ll need to file a claim with your homeowners or renters insurance. Anything not attached to the car itself will not be covered by your auto insurance policy.
Myth #3: Your insurance rates will go up if you file a claim.
It’s every driver’s worst nightmare: getting involved in an accident and having to juggle medical bills, repair costs and the ensuing legal battle. The last thing anyone wants to see after filing a claim is their monthly rate skyrocket. The belief that insurance rates go up after filing an insurance claim is pervasive, and it has led many to forgo using the coverage they pay for every month.
Don’t let this car insurance myth prevent you from filing a claim. The truth is that insurance rates are likely to go up when you’ve been found to be at fault for an accident. Simply being involved in a wreck isn’t enough for your rates to increase. In fact, California and Oregon do not allow rate increases for no-fault accidents.
Myth #4: If your car is totaled in an accident, your insurance company will pay off what you owe on your auto loan.
Learning your car is totaled is always disappointing. Learning you’ll still need to pay off what you owe on it can be even more devastating. That’s the reality many drivers don’t appreciate until it happens to them. Without gap insurance, drivers of whose cars were totaled in an accident may be stuck with a monthly payment for a vehicle they can no longer drive.
When you total your car, an insurance agent will work with a mechanic to examine the damage. They’ll note the condition of the car before it was involved in the accident and determine the actual cash value, or ACV, of the vehicle. The age and wear and tear of the car are all factored into the equation to determine the ACV. You’ll then receive a check equal to the ACV. If your ACV is less than the outstanding loan amount, you will need to continue making monthly payments.
Myth #5: Sports car drivers pay high insurance premiums.
Does having a sports car increase insurance? Many sports car drivers do indeed pay high insurance premiums, though not for the reasons you might expect. Many such motorists are inexperienced, have a history of getting into accidents or are driving a new, expensive vehicle. These factors determine how much a person pays for auto insurance, not the make or model of the vehicle itself. Not all sports car drivers pay high premiums. If you’ve been safely driving for 20 years and own a decade-old Mustang, you’re likely to pay less than the college kid next door with the brand-new Maserati.
There are countless other car insurance myths, but these five are especially ubiquitous. If you’re curious about a particular car insurance conundrum, give us a call. Our customer service agents are subject-matter experts and ready to answer any question you might have about Wawanesa’s coverage. Curious about what monthly rate you might be eligible for? Get a quote online in just minutes by filling out this form.
The above content is for informational purposes only and is not a direct representation of coverages offered by Wawanesa or its policies. The information does not refer to any specific contract of insurance and does not modify any definitions, provisions, exclusions or limitations expressly stated in any contracts of insurance. All references within the above content are illustrative and may not apply to your situation. The terms and conditions of the actual insurance policy or policies involved in a claim are determinative as to whether an accident or other loss is covered. To understand the coverage under your current policy, please log into the account management platform to review your policy or contact an agent directly.