It is never easy to understand all the legal nitty gritty of an insurance policy. So its important for car owners to know how to differentiate what’s a fact and what is false. We try to demystify some of the myths below1. My old car won't be a target for theft. Wide off the mark!
According to a report by the insurance crime bureau individual involved in car theft preffer older models because they are easy to steal. The ‘89 Toyota Camry, ‘91 Honda Civic and the ‘95 Honda accord are some of the models listed as easy to steal by the report.
2. Credit scores don't affect insurance rates.
There are several factors taken into consideration by insurance companies when determining premium rates. Credit scores give a hint to wether your are a good manager of your money, a factor looked at by most companies when you try to buy, renew or upgrade your insurance policy
3. The color of my car matters.
It is widely believed that the color “red” drive premium prices up which is not the case. Insurance companies are more interested in the year the car was manufacture, the make and model of the car. Last but not least the engine size is also taken into consideration. While you may give great attention to the color of your car, insurance companies don’t.
4. My insurer can cancel my policy any time.
Unless you give the company satisfactory reasons to do so, you can't arbitrarily cancel a policy mid-term. Grounds for cancellation could include non-payment of premiums or fraud.
5. Your friends are responsible in case they borrow your can and are involved in an accident.
Car insurance companies tend to monitor the car, not the driver. So you are at the end of the day responsible for any accidents and damages that occur.
6. I'm covered in case my car is stolen, damaged by wind, fire or flood or vandalized.
Comprehensive cover is optional when purchasing an insurance policy. It is not automatic if a tree falls on your parked car or its sprayed with graffiti by unknown persons you will be sorted out. Comprehensive cover is not enough, you will require additional coverage for the above damages.
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7. My Personal property inside my car is covered.
Sorry, If your expensive electronics and other valuable items are stolen or damaged, you're out of luck. However you may file a claim through your homeowner policy and not through your car insurer.