Since everyone needs to buy insurance at some point, there are a lot of different myths out there in the market. While some of the myths are based on truth, there is undoubtedly a lot of misinformation out there as well. If you're in the market for an insurance policy, here are a few myths by Kanetix.ca that you need to have a basic understanding of.
All Auto Insurance Policies Cost Pretty Much the Same
Some people think that insurance policies all cost approximately the same. In reality, there are large differences between policies, and some people pay a lot more than they should for coverage. There are policies for people who don't drive that much, policies for those with good driving records, and a lot of other types of policies. Many different variables go into figuring out how much you will pay for your auto insurance premiums.
Paying More Means You're Getting Better Coverage
There is also a common misconception in the insurance market that paying more for your premiums means that you are getting better coverage. In reality, this simply is not true. Sometimes, you might end up paying a lot more and get less coverage. When you are comparing insurance policies, make sure that you compare the actual coverage limits that you're getting as well as the premium prices.
Switching Will Cost You Money Because of the Loyalty Discount
Although many insurance companies do give you a discount for being a loyal customer, it doesn't necessarily mean that switching will be a bad deal. If you find a company that's going to give you a lower premium than what you are currently paying, it doesn't really matter if you're getting a loyalty discount or not. You should only be concerned with the bottom line, and not with the names of the different discounts that you are getting from the insurance companies.
I'll Have to Pay More Because of My Driving Record
It's true that insurance companies base their rates partly on your driving record. However, just because you have a poor driving record, that does not necessarily preclude you to a life full of high insurance rates. If you will do little bit of shopping around, you can still get competitive and affordable rates. Insurance companies don't all target the same drivers or have the same overhead costs. Because of this, they all charge different rates for their policies.
The Colour of My Car Affects Insurance Rates
One of the most common myths in the insurance industry is that the colour of your car will have an impact on your insurance rates. In reality, the colour has no impact on the amount that you have to pay in premiums. For example, some people think that having a red car means you will pay more in insurance premiums. The insurance company does look at factors like the year and the model of your car, but the colour shouldn't have an impact.
If Someone Else Wrecks My Car, It Won't Affect Me
Although your car insurance should pay for the damage your car when someone else is driving, that does not necessarily mean it will not affect you in the future. Even if someone else is driving your car, any damage that they do will still go on your insurance record. This means that you may have to pay higher auto insurance rates, because of something that you didn't even do.
One Sex Pays More Than the Other
Another common myth in the auto insurance industry is that one sex pays more than the other for car insurance coverage. Some people say that men pay more for insurance, while others say that women do. In reality, there is no one-size-fits-all answer for this question. Some insurance companies charge more for women while some charge more for guys. You really just have to get a quote and see who costs more.
Cheap Cars are Cheap to Insure
While this may be the case in some instances, it's not a hard and fast rule. Sometimes, cheap cars cost more to insure than a more expensive model. For example, if your cheap car has a very heavy engine, you might have to pay more for coverage than you would with a different car. When buying a car, don't automatically expect to pay less for cover just because you go with one of the cheaper cars on the lot.