6 Common Car Insurance Myths

Don’t believe everything you hear – especially when it comes to purchasing an auto policy. There is a lot of misinformation circulating about insurance. To help you separate facts from fiction, we explain six common car insurance myths.

Myth #1: My Car’s Paint Color Impacts My Insurance Premium

This common thought is completely false. If you’ve heard this car insurance myth, you’re not alone. The color of your car doesn’t determine your insurance policy’s cost. However, your car’s make, model, body type, year, engine size, etc., does factor into the premium cost. So, if red is your favorite color, you’re in luck when you go to pick out your next car.

Myth #2: I Only Need the Minimum Auto Insurance Required by Law

Most states require you to carry a minimum amount of auto liability coverage.  However, should you be at fault in an accident, you are more likely to pay out-of-pocket for losses you’re liable for. In addition, damages to your vehicle won’t be covered if you carry only liability coverage on your vehicle.

Myth #3: My Personal Auto Insurance Will Cover the Business Use of My Car

Unfortunately, this is a common misconception that many believe. If you use your personal car for business, you’ll likely need to purchase business vehicle insurance.

Myth #4: Comprehensive and Collision Insurance Are the Same

Comprehensive and collision insurance provide different protections.

• Comprehensive coverage covers loss due to events such as theft, vandalism, hail, fire and accidents involving animals (think deer accidents).
• Collision coverage pays for damage to your car, whether or not you’re at fault.

To ensure you have the coverage you need, it’s important to understand what is provided by different coverages.

Myth #5: My Auto Insurance Will Pay Off My Loan or Lease if I Total My Car

If a loss totals your car, your insurance company will only pay what the market determines your car was worth prior to the accident. This amount factors in depreciation – meaning your car isn’t worth the amount it was when you drove it off the lot. If you have any outstanding amount on the loan or the lease, it’s your responsibility to pay.

Myth #6: My Auto Insurance Will Cover Mechanical Repairs

Mechanical repairs being covered is a common car insurance myth. Unless the mechanical repairs are needed resulting from a covered accident, your auto insurance won’t cover these costs.

When it comes to purchasing an auto insurance policy, be sure you have the facts. Your local Farm Bureau agent can answer your questions and help ensure you have the right auto coverage in place. Contact us today!