Myth-Busting Insurance Myths: Are red cars really more expensive to insure?
In ancient society, myths and legends evolved from word of mouth. It’s likely that the same can be said about today’s auto insurance myths. Somewhere along the way, someone deemed red cars to be more expensive to insure and
“The color of your car has nothing to do with auto insurance rates.”
Myth #1: Red cars are more expensive to insure
There’s a cost for looking flashy on the highway in your bright fire engine red sports car, right? Wrong. However, if your bright red car happens to be a ritzy, sophisticated convertible, you may end up spending more on insurance – but not because of the color. According to Financial Avenue, Inceptia’s online education program, the color of your car does not have anything to do with your rates. The cost of insurance is dependent on the make and model of your car, the body type, the engine size, as well as your age, driving record and credit history.
Myth #2: My car and I are covered from vandalism and weather damage
The type of coverage that would protect you from a tree crashing into your windshield or someone breaking into your car is not mandatory. If you want to be 100 percent safe and protect your vehicle from all types of damage, you’ll need to purchase comprehensive and collision coverage, both of which are optional. These two types of coverage are what will protect your vehicle. Liability coverage is only going to cover you if you hurt a person or damage someone’s property. If you have a lease or a car loan, it is likely that the lender will require you to get both comprehensive and collision insurance.
Myth #3: You’re covered under your policy while driving your company’s car
If you deliver pizza on the weekends but you’re not an employee of the restaurant and you get into an accident with your car, you’re on your own. The company’s insurance will not cover you. According to NBC News, you are not protected by your personal auto insurance if you are self-employed and driving your own car for work purposes.
Myth #4: The cost of insurance goes up for the elderly
Although this may be true for life insurance, the cost of insurance does not go up as you get older. In fact, auto insurance rates even have the potential to go down as you age. Once you’re over the age of 55, you may qualify for a reduction in your auto insurance rates, plus additional discounts with affinity groups AARP or AAA. By taking an accident prevention course and successfully completing it, you may have the opportunity to receive up to a 10 percent discount if your provider participates in this incentive. Some providers also offer a 5 percent discount on insurance if you are retired or unemployed, although restrictions exist.
Myth #5: If my friend borrows my car and gets in an accident, he or she will be covered
According to the Department of Motor Vehicles, the general rule of thumb for most policies is that anyone living in your home is usually covered while driving your vehicle. However, people in that household are usually required to be on the vehicle’s insurance policy. If a friend is driving your car and gets into an accident, his insurance would not be the primary coverage to take care of the damages – your own car insurance would be. His would only act as secondary, or excess, insurance. In the event that a friend or family member will be frequently driving your car, give him or her permissive use on the policy. This will mean that the the driver is covered by your car’s insurance.