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5 Common Myths About Auto Insurance

If you have been driving for a while, you already know the importance of having auto insurance. However, no matter how long you have had an auto insurance policy, you still may not know everything about it. Here are some common myths about auto insurance that you should never believe.

1. It's Only Necessary to Buy the Minimum Amount of Auto Insurance Required

Most states only require you to have liability insurance. While you probably want to pay as little as you can for auto insurance, it is not in your best interest. If you only carry liability coverage, it only covers the other driver's damages in the event of an accident. You will not have coverage for your own vehicle. By spending the extra money on comprehensive and collision coverage, you can have better peace of mind.

2. Your Policy Will Always Pay for a Rental Car After an Accident

Many people assume that their auto insurance policy will automatically pay for a rental car if they are involved in an accident. However, you actually have to add rental car reimbursement to your policy first.

3. Your Credit Rating Does not Affect Your Auto Insurance Rates

Your credit score can indeed have an impact on your monthly auto insurance premiums. Insurance companies assume someone with a high credit score will be less likely to file insurance claims. Therefore, the higher your credit rating is, the better your auto insurance rates will be.

4. Red Cars Cost More to Insure

If you believe that red vehicles cost more to insure, you are not alone. Many people are convinced that this myth is true. However, auto insurance companies do not care what color your vehicle is. They place more importance on the make and model of your car and its safety record.

5. If You Get a Traffic Ticket, Your Auto Insurance Rates Will Increase

Receiving a traffic ticket is never a positive experience, but it does not automatically guarantee that your auto insurance rates will go up. If you have a good driving record and your violation was fairly minor, your insurance company might decide not to increase your rates. Just make sure to drive more carefully to avoid future tickets. 

As you can see, there are a lot of myths circulating around auto insurance. If you have any questions about your current auto insurance policy, you should contact services such as Nelson Insurance Agency.