Car insurance is one of the most universal consumer products purchased in the U.S., since nearly every driver who gets behind the wheel of a vehicle is required by law to carry coverage. Despite its wide availability, however, there are still many misconceptions that surround car insurance as a whole. Continue reading as the team here at Lillie-Couch Insurance uncovers the truth to some of the myths car insurance agencies hear the most.
Car Insurance Companies Can Cancel You Whenever They Want
True – Your car insurance policy is a contractual agreement between you and your insurer. The only grounds for terminating the contract are non-payment of your premiums or fraud. That means that your insurance company cannot simply drop you in the middle of a term just because you had an accident, received a ticket, or suddenly became a higher risk driver than you were when you purchased your coverage. However, an insurance company can choose not to renew your policy once your existing term is complete.
Red Cars Cost More to Insure
When you close your eyes and imagine a brand new sports car, what color is it? Red is often associated with fast cars and has taken on a reputation for costing more to insure. The truth is, the color of your vehicle has nothing to do with how much you will pay for insurance. The driver of a red car is no more likely to be pulled over or to be in an accident than the driver of the same vehicle of another color. Instead, insurers care much more about the body style and engine size of the vehicle. In other words, the red car might cost more to insure, but only because it’s a high-performance, late model, two-door convertible – not because it’s red.
Car Insurance Always Pay for Theft and Vandalism Losses
We may enjoy a slower pace of life here our small town, but that does not mean the risk of car theft or vandalism does not exist. In fact, the nearby town of Eau Claire is one of the top cities in Wisconsin for auto theft according to the American Safety Council. If you plan to file a claim for the theft or vandalism of your vehicle, the insurance company will only process that claim if you have comprehensive coverage in your policy. Unlike collision insurance, comprehensive insurance pays for damages and vehicle losses caused by certain covered, non-accident related events. Even then, insurance companies tend to cover only the damages to the vehicle itself – not the theft of its contents. For that, you would turn to your home, condo, or renters insurance.
You are Not Responsible if Your Friend Wrecks Your Car
Imagine loaning your vehicle to your best friend while her car is in the shop. While behind the wheel, she skids into the back of a bus, totaling your vehicle and injuring a few people in the bus. Even though you were not in the car, much less driving the vehicle, you find out that you are being sued for injuries sustained as a result of the accident. The reason for this is that car insurance tends to follow the vehicle – not the person behind the wheel. Victims can pursue your coverage for compensation even if you had nothing to do with the accident.
If you have questions about car insurance, feel free to give us a call. We’d be glad to help out.