Car Articles

Read articles on cars and car industry. Get fully updated on all information related to cars. Read exciting happening in the Indian and Global Car industry, tips to help you and more...

Old Articles

5 Predictions about Electric...

Car Insurance Misconceptions...

Car Insurance Misconceptions Debunked

Whether you buy a new car or a used car, insurance plays an important role. Find the right kind of vehicle insurance for your can prove to be a daunting task for most of the people. However, if you are an informed consumer, the process may be easier. When we talk about car insurance, there are several misconceptions associated with it. Here we try to debunk some of the common car insurance misconceptions.

More expensive premiums for red cars

Many people believe that flashier paint colours, including red and black, come with expensive insurance premiums. This is totally untrue. Insurance companies do not take into account the colour of the car while calculating the premium. Contrary to that, the companies do consider the car's make, model, body type, year and safety features to work out the premium.

Expensive cars, including SUVs and luxury cars, incur higher insurance premiums due to costly parts and labor. However, if your car is equipped with safety features such as ABS, airbags, and anti-theft device, you can receive a discount on your car insurance.

Age has nothing to do with the cost of car insurance

Well, this needs some explanation. Drivers below the age of 25 years and above the age of 65 years pay more for their car insurance in some countries. Statistics have proved that this particular age group drivers cause more accidents that drivers between the ages of 26-64 years. Usually male drivers under the age of 25 years pay the highest car insurance premiums. It has proved by statistics that this particular group causes more traffic accidents than all others.

My friend wrecked my car, so I'm not responsible

Hmm, so you thought but the truth is different. If your car happens to be in a wreck, it's solely your responsibility. The accident will be registered in your insurance record, and may also result in you paying a higher premium. But despite the circumstances of the car wreck, the insurance company will cover the cost of the wreck.

My car insurance premium does not get affected by my credit Score

Your credit score can actually affect your car insurance rate in much the same fashion it does affect your ability to get a job or buy a home. So how does one increase the credit score? Here is the solution. Pay your bills on time and be responsible with your finances. You can measure your credit scores online by generating a free credit report.

My existing insurance policy automatically covers my new car

Well you don't really have to take a new insurance policy when you purchase a new car. However, you need to inform your insurance company, who would immediately transfer your existing policy to cover the new car. If you fail to do so, your new car may not have proper insurance coverage.

Collision covers all non-driving damages

Most car drivers assume that collision coverage will protect their cars, which is far from truth. Collision coverage encompasses only driving-related incidents. Your collision coverage won't help you claim insurance for non-driving damages, including theft and vandalism, or damages due to fire, storms or animals. Here is a car insurance tip. Go for a comprehensive insurance policy which protects your car against non-driving damages too.

Older cars are less expensive to insure.

Vehicle insurance rates vary depending on a number of factors, including age of the driver and the annual mileage of the car. Older car drivers choose to take a Liability (BI/PD) only coverage, which covers injury or damage to other people and/or property. This kind of insurance, though, cheap does not cover injury to the insured person or vehicle.

Auto insurance rates are unregulated

Another common car insurance misconception is that the insurance rates are not regulated and hence the auto insurance companies can charge any amount they want. The truth is that every state makes it mandatory for auto insurance companies to file how they calculate customer rates. Each state also has regulators reviewing the insurance rates filed by a company.

Cheaper cars cost less to insure.

Well, this one is partly true. Your cheap car does incur lesser premium on comprehensive coverage, which protects your car against vandalism, hail, fire or animal accidents. But, if your cheap car features a large engine, weighs more or is an unusual model, the insurance might just get a little costlier.

» Read more Articles On Car Insurance