Top 5 Myths about Car Insurance
Everyone needs car insurance and it is essential even though it might not be our favorite expense. We all pay for it.
Yet a lot of people don’t truly understand how it functions actually.
This lack of understanding has led to many misconceptions about car insurance and these false ideas might be costing a lot of money.
So it is important to get the facts straight.
Here are the top five myths or misconceptions about car insurance that every one should stop believing immediately.
(i). Top 5 Myths about Car Insurance | Personal Car Insurance also Works for Business Use
If someone using a car for job related activities – like driving for a ridesharing service, delivering goods or even doing business errands then don’t assume the personal car insurance policy has full protection for this.
Unfortunately, it usually won’t cover any accidents that happen while the car is being used for business purposes. Instead, it requires a commercial insurance policy only.
Additionally, if someone is driving for services like Uber or OLA, he/she might also require a specific policy designed for rideshare drivers to ensure they are properly covered.
(ii). Top 5 Myths about Car Insurance| Full Coverage Protects Against Everything
When people hear about the full coverage they often think it is like a magical shield protecting their car from anything. In reality full coverage just means the liability insurance as well as comprehensive and collision coverage.
It doesn’t cover every possible situation.
For example, if Someone’s car has a mechanical breakdown or suffers from regular wear and tear, those might not be covered. Similarly natural disasters are excluded in the coverage. It is important to read the policy carefully to understand exactly what is covered and what isn’t.
(iii). Top 5 Myths about Car Insurance| Do Older Drivers Pay More for Insurance?
Many people think older drivers pay more for insurance. Basically age does affect the insurance cost but younger drivers, especially those under 25 pay the highest rates.
As insurance companies see younger drivers as riskier due to their limited driving experience.
On the other hand older drivers with more years on the road often receive discounts.
However, when someone turns 70 or older some companies might raise rates again because of potential health concerns. Still, for most adults having more driving experience usually means to pay less for insurance.
(iv). Top 5 Myths about Car Insurance | Car Color and Insurance Costs
Mostly people think that driving a red car will make insurance more expensive. even it is belived that red is often linked to sports cars and fast driving.
Actually, insurance companies do not consider the color of the car when deciding for premiums.
They majorly focus on other factors like the car’s make and model, the year it was made, the engine size and how often that type of car is stolen.
So if believing while buying a bright red Ferrari or Bugatti will raise insurance rates then no need to worry about the color affecting the costs.
(v). Someone else’s insurance won’t cover an accident in someone else’s car
This is again a common misunderstanding and many people believe that if a friend or family member borrows their car and gets into an accident The insurance of the person driving will cover the damages.
However, the reality is different- car insurance is basically linked to the car itself not the person driving it.
For Example: if A allows B to drive his car and meet with an accident, it is A’s insurance that will be responsible for covering the costs. While B’s insurance might provide some additional coverage, A’s policy will be the one primarily responsible for handling the situation only.
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