We're required to have insurance, but what that insurance covers can vary from company to company, policy to policy, and even person to person. The result is you could think your insurance covers something it doesn't, and this list helps separate fact from fiction.
Photo by Andrew Steinmetz.
The full list, from our friends at Your Mechanic, is at the link below, but here are the top five myths that they break down in quick succession:
- Insurance only covers you if you're not at fault. This one should be easy, but a lot of people still believe that their insurance won't help them if they're the "at fault" party in an accident. Nothing could be further from the truth (trust me, I know.)
- Red cars are more expensive to insure. This is a long-standing myth about auto insurance. In short, it's not the red car that costs more, but in many cases the person who's driven to buy the flash red sportscar that costs more to insure. Those rates are more about risk than the colour of your vehicle.
- Auto insurance protects anything stolen from inside your car. Your insurance may cover damages and repairs to your vehicle as a result of the break-in, but if someone steals your expensive cargo or anything of value in your vehicle, your auto insurance won't cover that. However, if you have a renter's insurance or homeowner's insurance policy (and you absolutely should), that policy may cover your losses there, so make sure to give your insurer a call.
- Insurance only pays out for the post-total value of your car. Hopefully you'll never get into an accident where you total your vehicle, but no, your insurance company won't just pay you what the vehicle is worth after the wreck (which in many cases, is next to nothing.) They will pay out for its value before the crash, but be warned — that's probably not even close to what you might think it's worth, or even close at all to Blue Book value.
- Insurance covers mechanical repairs and breakdowns. Again, this is usually something new drivers wind up believing, but no — your auto insurance doesn't cover mechanical failures, wear and tear, and other breakdowns that are just part of owning a vehicle. It's why it's so important to find a mechanic you can trust, keep up on your preventative maintenance, and learn to do some repairs yourself. Even worse, calling your insurance company over and over to claim mechanical failures will lead to higher premiums for you in the long run.
You can check out more on each of these topics at the link below, along with a little information about where these aren't totally ironclad, and what your insurance company might actually cover under one of these umbrellas.
Top 5 Insurance Myths You Shouldn't Fall For [Your Mechanic]