If you own and operate a vehicle, you must have some type of insurance policy that not only protects you and your finances but also others in case they are involved in an accident along with you. In addition, if you are financing the vehicle, the insurance is necessary for protecting the loan company in case the vehicle is totaled beyond repair. Fortunately, shopping for the best and most affordable insurance policy does not have to be complicated. With proper understanding, you will learn the truth behind a few myths regarding auto insurance, its benefits, and its costs.
All States Require Maximum Coverage
One common misconception most drivers believe is that all states require the same amount of insurance coverage. In reality, each state has different requirements and knowing the requirements in your specific state is key. For example, drivers in Alabama require coverage of $25,000 bodily injury liability per person. In Iowa, $20,000 in bodily injury liability coverage per person is required.
Not only are there specific requirements for bodily injury liability coverage, but there are also property damage requirements that should be met. Again, it is best to consult insurance agents in your specific state to determine what is required and what is not.
Insurance Premiums Increase with Age
Many people believe they will see an increase in their insurance premiums as they age. In reality, the opposite is true, especially if you are comparing premiums from when you first started to drive until much later in your life.
Younger drivers are more inexperienced than older drivers, so there is usually a higher risk of accidents and traffic violations. This inexperience is why insurance premiums are so much higher for teen drivers who just received their driver's license. Unless you have received numerous tickets or been involved in many accidents, your insurance premiums should decrease as you become more experienced.
Ask your insurance agent if they offer specific discounts for more experienced drivers.
Color Affects the Price of Auto Insurance
Another common myth some drivers believe is that the color of their vehicle will affect their insurance premiums. Again, this is not true, so you do not have to worry about choosing whether a fire-engine red or standard gray is the most affordable color to insure.
The premium price is based on factors that do not revolve around the color of your automobile. These factors include the overall value of your vehicle and its make and model. For example, a luxury automobile will be more expensive to insure, since its value is probably higher and more expensive to replace and repair if you are involved in an accident. As another example, sports cars are more expensive to insure than sedans and sport-utility vehicles because they may have faster, more powerful engines that could lead to more accidents and traffic violations.
Theft and Vandalism Is Covered by Insurance
Having your vehicle stolen or vandalized can be overwhelming. In many cases, you may believe your insurance policy will cover the cost of replacing or repairing your vehicle after it is stolen/vandalized. Unfortunately, that is not necessarily true.
Whether or not you have this coverage will depend on if you have collision and comprehensive coverage along with your standard insurance coverage. This additional coverage may seem costly, but it can be a great investment if your vehicle is stolen, vandalized, or stolen AND vandalized, allowing you to have the funds to restore your vehicle back to its original state.
Understanding your policies and what you are insuring is imperative for safe ownership of your automobile. This guide will ensure you understand your auto insurance policy, its costs, and the coverage it provides.
Learn more from an agent that provides car insurance, such as an agent that offers Bear River insurance.
Share1 April 2019
About a year ago, I started thinking more seriously about choosing different insurance. I was focusing on all of the different aspects of insurance, and it was really interesting to me to see how much I could save by switching services. It was a lot to process, but before I knew it, I was able to completely overhaul my insurance coverage, and it made a tremendous amount of difference for me. This blog is here to help other people to know what to look for in insurance coverage so that they can enjoy a happier tomorrow. Check out this blog for more information.