It’s time for us to debunk four more common auro insurance myths and find out what grains of truth they may stem from. Knowledge is power and understanding correctly how carriers determine your car insurance premium can give you important insight to make the right car or insurance purchase.
If your car is totaled, insurance will pay for your new car.
If your insurance reimburses you for a covered total loss, such as your car being totaled, depreciation is taken into consideration. Depreciation is the decreased value of an item over time from the age of the property or wear and tear. Depending on your type of coverage, you may get money for your totaled vehicle, but it will most likely not equal the original purchase price.
Personal auto insurance also covers business use of your vehicle.
Driving a vehicle for business purposes has its own set of risks, which requires different types of coverages that your personal auto policy may not automatically cover. If you are using your vehicle for work or driving for a rideshare service like Uber or Lyft, you need to have a discussion with your insurance agent to confirm that you are properly insured.
The more expensive the car, the more it costs to insure.
The price tag on your vehicle doesn’t necessarily determine your insurance costs. However, how much your vehicle costs to repair, the vehicle model’s loss history and other characteristics can influence your premium. If your car model is associated with more accidents or traffic infractions, or is costly to repair, it may be more expensive to insure.
Getting a traffic violation will automatically increase the price of your premium.
Getting one traffic violation doesn’t always lead to a higher premium, especially for minor incidents. However, if your violations become more severe or you continue to accumulate tickets, the insurance companies will perceive you as a larger risk and you will probably begin to see an increase in your insurance premium. Maintaining a clean driving record following a violation will help alleviate some of the financial repercussions.
Get the Facts
There is a lot of false and misleading information floating around about car insurance, that’s why it is so important to work with trusted insurance experts. Our highly capable team members can ensure you have a clear understanding of your auto insurance options and what tailor them to you. Reach out to them today!