Are you a young adult, getting ready to move out on your own? Will this be the first time you've had to get your own insurance policy on your vehicle? If you've always been on your parent's policy before, there are things you might not know about auto insurance. Here are some of the most common myths and the truth behind them:
The price of your insurance policy changes depending on your vehicle color. Many people associate different color cars with different levels of police attention. For example, it's often believed that a red vehicle will get more tickets than a white one. As such, you might have been told that a vehicle with red paint will have higher auto insurance premiums than a white one. If you've gotten quotes for different cars that you're thinking about buying, you might have even seemed to have confirmed this myth. But if you were getting rates for two separate vehicles, the one with the higher rate was either newer or is more commonly stolen in your area. It had nothing to do with the paint color of the vehicles in question.
If your friend borrows your car, he or she is responsible for damages in case of an accident. If you loan your vehicle to a friend, it's your auto insurance policy that will cover the resulting damage. Because of this, your auto insurance premiums could skyrocket if your friend causes an accident. If you don't trust your friend's driving well enough to ride along in his or her vehicle when he or she is driving, you probably shouldn't lend your vehicle to him or her.
Insurance will always cover any damage to a vehicle. If you opt to have liability auto insurance only, your vehicle will not be covered in most accidents. It will only cover damage to the other party's vehicle, should there be another person involved. If you want to make sure that your insurance policy will cover repair bills for things like theft, fire, or other damage, make sure that you opt for the slightly more expensive full coverage option when you are deciding which policy you should get.
If you don't like your insurance policy, you can just cancel it. If you cancel your auto insurance policy without having another one, you could get into legal trouble. Some states require insurance companies to notify the state DMV in the event of cancellations. Even if your state doesn't require this, if you're still making payments on the vehicle, the insurance company may notify the bank or car dealership, if you still owe money on the vehicle, that you've dropped your insurance policy. Your car purchase or lease agreement could have a stipulation in one of the clauses that they'd then be allowed to repossess your vehicle.
For more information, talk to a car insurance representative like Wyatt Insurance Agency.