Saturday, May 26, 2007

Top 10 Auto Insurance Myths ...

Top 10 Auto Insurance Myths
The color of my car determines my auto insurance rate. My credit score has no bearing on my insurance premium. I have auto insurance coverage so my new car is already covered…right?

Maybe not! Below is a list of fallacies many car owners believe and drive by each day. The truth just might make you change course.

Myth #10

"No-fault insurance means, it's not my fault!"

False. No-fault insurance means that your insurance company pays for your damages regardless of who's at fault.

Myth #9

"The color of my car affects my insurance rate."

False. The color of your car does not impact your car insurance rate. What does influence your rate is your vehicle's year, make, model, body type, engine size, credit history and driving record.

Myth #8

"If I lend my car to a friend and that friend is in an accident, his or her insurance company will pay for the damages…right?"

False. Your car, your responsibility! And guess what, even though you weren't present at the time of the accident, you still will receive a mark on your insurance record and your insurance premium could possibly go up.

Myth #7

"My insurance rate is set by the government."

False. The government has nothing to do with your car insurance rate. Where you live, your credit score, marital status and your driving record is what actually affects your premium.

Myth #6

"I recently paid my insurance premium, so the new car I just purchased is covered."

Not necessarily. Most automobile policies require that the policyholder notify the insurance company or agent within a specified number of days, if indeed coverage is desired for the newly purchased vehicle.

Myth #5

"It's a fact, males under the age of 25 pay more for auto insurance."

True and False. Males under 25 years old can potentially pay more for car insurance than female drivers. However, across the board, teenagers and mature adults pay more for auto insurance, due in large part because these age groups are typically involved in more automobile accidents.

Myth #4

"My credit score has no affect on my insurance rate."

False. Your credit score really does matter! Many Insurance companies take your credit score into consideration when deciding to increase or renew your auto insurance coverage.

Myth #3

"Even without comprehensive coverage, I'm still covered for theft, windstorms, hail and deer accidents."

False. Many drivers believe that if they only purchase collision insurance, which covers accidents involving objects, that they will also be covered for incidents that involve vandalism, hail, animal accidents and fires. That simply is not true. You need to purchase both collision and comprehensive coverage in order to fully protect your vehicle from all of these situations.

Myth #2

"My personal auto insurance covers both my personal and business use of my car."

False. If you occasionally use your personal car for business purposes such as transporting clients, going to and from meetings or hauling business equipment, then you will more than likely need to extend your personal car insurance to cover your business use as well. Plus, if your employees use their car while working for you, you will want to also obtain a separate non-owned car insurance policy.

Myth #1

"I've never had or been involved in a car accident, so I don't need automobile insurance."

False. Some drivers are lucky enough never to have been or to be involved in an accident. However, if by chance you do have an accident, your risk of losing everything is great. Car insurance is the best protection you can have in the event an automobile accident occurs. It's also a legal issue - you are required, by law, to have some basic form of auto insurance, and failing to do so carries some fairly strict punishments.


MONA said...

So much good & useful information here little lamb.


& what do I see!! Ted skipping rope with LL in the ewe symphony! LOL

Cazzie!!! said...

A guy reversed around a corner of a carpark without looking and slammed into the front of my brand new Mazda 2 a few weeks back. His first comment, "Well, I have no job and am un insured, so that's bad luck". My reply, "That is why I took out full comprehensive I can sue your ass off!!"
Over here, insurance price goes by the vacinity you live in, the precedence of amount of cars stolen in the area and your age, etc etc. It is just that way with each insurance company here.

Interesting post here for sure.

Little Lamb said...

Mona - Thank you. Ted is something eles entirely.

Cazzie - Thanks for visitng. I have to check to see if I have comprehensive. It sounds like a good deal because there are those who don't have insurance. If I don't have it, it sounds like a good investment.

carmen said...

hi, LL... actually i am mula w...
i want to insure myself you are ewe.

Crashtest Comic said...

I wish I would have read this before I slammed into that school bus.

The Phosgene Kid said...

If you are an Illegal or have Mexican plates, you don't need insurance - true, apparently...

Little Lamb said...

Silly Carmen.

Crash, Oh dear!

Kid, that is so unfair.

puerileuwaite said...

The homies in my 'hood said that I needed to take out a comprehensive policy with them.

They showed me pie charts and statistics that revealed an astounding 100% of neighbors who didn't get the policy through them suffered losses due to fire and theft.

That, like your post, proved very troubling yet educational. Good job, Lambycakes.

Anonymous said...


so you insure with
bush, cheney, & wolfowitz, too...


Anonymous said...


true enough,
though if you do,
your (statistically) 97.3% less likely to get three or more bullets in the back


Anonymous said...



Little Lamb said...

Pug,I love when you call me lambycakes.

puerileuwaite said...


so you insure with
bush, cheney, & wolfowitz, too...


Unfortunately. Yet I have this uneasy feeling they're not on the "up and up".


As you wish, my little Lambycakes.


Little Lamb said...

Thank you, puggy.

it's hard to trust politicians, any of 'em.

Cazzie!!! said...

Yes, definately, insure your own arse in case they don't have it. Then, your insurance sues their ass for not having any and to fix your vehicle.

Little Lamb said...

I like your thinking Cazzie

Gledwood said...

This is fascinating..!
I used to work for a big insurance company.
It was always fun in the early afternoon when Medical Insurance "extra details" forms came through... some lurid stories about warts tracking their way between body parts etc ... I won't go on! But what got me was that if I had the temerity, once I'd scanned said mail into the computer, to for any reason to try and fish it back, a huge !exclamation!! in a triangle came at me telling me I'd been reported to security for this attempted breach!! Honestly! And yet I could do whatever I liked with that info while it was on paper. Photocopy it. Steal it and take it home. Make a paper aeroplane out of it. But ooo! Once it was inside a computer it became sacred!

Number 8 I think it was "your car your responsibility" I'm not sure that's at all fair ... imagine if they extended this concept of law to such implements as guns and kitchen knives ..?

Then again, since when did the LAW have anything to do with what's right and wrong??

How's it going with you? Hope all's fine!

Take care