When it comes to auto insurance, everyone has an opinion about coverage—but not all of them are accurate. You may hear myths like "Red cars cost more to insure" or "Old cars don't need coverage," and you'd be surprised how quickly misinformation spreads. We're here to clarify things for you. We've compiled some of the most common myths about auto insurance and debunked them, so you can make better, more confident choices about your coverage.
Myth #1: Red Cars Cost More to Insure
Truth: This is one of the most common myths regarding auto insurance—and it is completely false. Insurers do not care about the color of your car. What matters are factors like your driving record, the make and model of the car, engine size, and your location. So if you've been avoiding a red car because you thought it would increase your insurance premium, go ahead and buy that car.
Myth #2: Older Cars Don't Need Coverage
Truth: Even if your car is old, an accident, theft, or liability could still expose you to significant risk. No coverage might save you money now, but one incident could cost you much more than a few months of premiums. Instead of dropping insurance on your old car, you can adjust your coverage. You could maintain liability coverage and drop the collision or comprehensive depending on your vehicle's value.
Myth #3: My Auto Insurance Is All-Inclusive
Truth: Not exactly. A typical auto policy won't necessarily cover all situations. For example, mechanical breakdowns, ordinary wear and tear, or using your vehicle for ridesharing (such as Uber or Lyft) often require additional endorsements or coverage. Take time to read your policy thoroughly or ask your agent to explain all the covered and uncovered areas in the policy.
Myth #4: Minimum Coverage Is All I Need
Truth: While purchasing state-mandated minimum coverage is the easiest option, it may not fully protect you when an accident occurs. California's minimum liability limits may not cover the entire cost of an accident, especially if there's significant property damage or medical treatment involved. Opting for slightly higher coverage will provide much larger protection from risks and incidents of loss—potentially saving you thousands.
Myth #5: My Credit Score Does Not Affect My Premium
Truth: In many states, your credit history can potentially affect your premium. Insurers consider financial responsibility as one of many indicators of reliability. Maintaining a good credit record by paying bills on time with minimal late payments can help you secure better insurance rates.
Myth #6: My Friend's Insurance Will Protect Them If They Drive My Car
Truth: In the majority of situations, insurance coverage follows the vehicle, not the driver. This means that if your friend gets into an accident while operating your automobile, your auto insurance policy will likely be involved—not your friend's insurance policy. Always verify that anyone borrowing your automobile is appropriately licensed, responsible, and insured.
Final Thoughts
Understanding your auto insurance policy is key to protecting both your vehicle and your wallet. Believing in myths could result in coverage gaps, unexpected bills, and stress when an accident occurs. At Sierra Mountain Insurance, we believe in clarity, honesty, and coverage that truly fits you and your lifestyle. Whether you're buying your first car or renewing your policy, our team is here to support you every step of the way.
Ready to bust some myths?
Let's review your auto insurance policy today to make sure you're getting the coverage and peace of mind you deserve. Contact Sierra Mountain Insurance now!