Car Insurance Myths Continue to Thrive
By: Charles Essmeier | Posted: 30th March 2007
If consumers had a better understanding of auto insurance, they could have better coverage and save a lot of money, too. For a large number of consumers, car insurance is considered only when purchasing a new car. Car insurance is not something that many people think about often, and because of this, many insurance myths persist.
Listed below are a few things that people often misunderstand about auto coverage:
Myth: Low deductibles are ideal, so you don't have to "cough up cash" in event of an accident.
Fact: A good number of consumers are paying a lot of extra money in premiums for the benefit of having low deductibles. Most people seldom have wrecks, so they rarely have to submit a claim. Car insurance isn't intended to pay for every nickel and dime expense; it is designed to cover large expenditures that would be hard to pay out of pocket. It is more sensible to go with the biggest deductible you can afford, as you will save a great deal of cash on your insurance premiums. Do not pay higher premiums in order to enjoy a smaller deductible; it isn't worth it.
Myth: The government sets premiums, so you don't need to compare companies for the lowest price.
Fact: The Federal government has no say whatsoever in how pricing is established. Consumers can save a lot of money by shopping around for the best price, and smart consumers will do so. State governments do determine how pricing works in a given state, but the figures may be only guidelines.
Myth: Cheaper cars cost more to cover than luxury models.
Fact: The main factor is not the cost; it's this - how likely is it that a particular car will cost the insurance company money in the form of a payout? The costs of insurance are determined by a number of factors, like how much the car will cost to fix and the likelihood of the car being stolen. The price of the vehicle is largely unrelated to the price of insuring it.
Myth: The color of an auto affects the price of the premium.
Fact: This myth has lingered for decades; the popular misconception is that red cars cost more to cover than other colors because the color is "sporty." This is not true; the color of a car has no bearing on the price you will pay to cover it.
Myth: You don't have a need for any more insurance than the law requires.
Fact: The minimum amount of liability protection may not help you if you cause an accident with an expensive vehicle or if you cause substantial bodily harm to another party in an accident. You ought to consider carrying more coverage than the minimum required in most states in order to avoid a possible lawsuit.
It is well worth your time to know the difference between auto insurance myths and facts. Keeping informed about auto insurance can not only help keep you safe, but it can also save you money.
©Copyright 2007 by Retro Marketing. Charles Essmeier is the owner of Retro Marketing, a firm devoted to informational Websites, including LemonLawHelp.net, a site devoted to information regarding lemon laws for automobiles and Car-Insurance-Help.net, a site about car insurance.
About the Author
Charles Essmeier is the owner of Retro Marketing, a firm devoted to informational Websites, including End-Your-Debt.com, a site devoted to
debt consolidation, credit counseling, payday loans and personal bankruptcy and HomeEquityHelp.net, a site devoted to mortgages and
home equity loans.
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Tags: myth, likelihood, extra money, expenditures, myths, insurance company, company money, insurance premiums, car insurance, auto insurance, deductibles, federal government, smart consumers, state governments, car car, purchasing a new car, auto coverage, luxury models, nickel and dime