10 Car Insurance Rate Myths

Chances are you've come across at least a few of the most common car insurance rate myths. If you drive a car, you can't afford to be uninformed—you need to know the facts. Better that you learn those facts here than from your car insurance agent after an accident.

Insurance Myth #1: "Red cars cost more to insure."

The car insurance industry is color-blind. Whether your car is painted red, green, purple or tie-dye, you will be offered the same car insurance rate. In fact, when applying for a car insurance policy with most companies, vehicle color isn't included in the questionnaire.

Insurance Myth #2: "My credit score doesn't affect my insurance rate."

If you think car insurance companies don't take credit scores into account when adjusting auto insurance rates, think again. Many insurance companies use credit-based insurance scores to determine car insurance rates when you purchase, renew, or modify an insurance policy. Safe drivers with healthy credit scores are typically offered the lowest car insurance rates.

Insurance Myth #3: "Driving without a seatbelt doesn't make me a danger to other drivers, so if I'm caught my car insurance rate won't go up."

You may not pose a threat to other drivers when you drive without wearing a seatbelt, but you do pose a threat to your own well-being. If you're involved in an accident without wearing a seatbelt, you're more likely to be seriously injured or killed—making you more of a financial risk for car insurance companies. Therefore, your car insurance rate could rise if you're caught driving without a seatbelt.

Insurance Myth #4: "Cheaper cars cost to insure than more expensive cars."

Less expensive vehicles are generally offered lower comprehensive coverage rates, but that doesn't mean they're always the most affordable vehicles to insure. If a cheaper car has a large engine, a high theft rate, weighs a lot or is an exotic model, it could cost more to insure than an expensive vehicle.

Insurance Myth #5: "My neighbor's car insurance rate will be similar to mine."

Location plays a role in determining car insurance rates, but each driver is judged individually. Factors such as driving record, vehicle make and model, and marital status are considered when companies determine car insurance rates.

Insurance Myth #6: "Even though I don't have comprehensive coverage, I'm still covered for theft, fire, weather damage, and more."

If you choose to only purchase collision coverage—which covers damage resulting from auto accidents—your vehicle will not be covered for theft, fire, weather damage, deer accidents, etc. You need to purchase both collision and comprehensive coverage to protect your vehicle against these perils.

Insurance Myth #7: "The government determines car insurance rates."

The government does not set car insurance rates. Each state's insurance department sets guidelines each company must follow to calculate customer rates, but car insurance companies determine rates independently.

Insurance Myth #8: "I smoke, so my auto insurance rate will be higher."

Smokers do not pay higher car insurance rates than non-smokers. In fact, when applying for a car insurance policy with most insurers, you aren't asked whether or not you smoke. Your health and life insurance policies, though, are another story.

Insurance Myth #9: "If I get one traffic ticket, my car insurance rate will go up."

Sometimes a single traffic ticket will raise your car insurance rate, but not always. Depending on the nature of your violation, many car insurance companies won't raise your rate until you receive a second traffic ticket. Keep in mind that many factors beyond traffic tickets play a factor in determining car insurance rates.

Insurance Myth #10: "Having multiple insurance policies with the same company always results in lower car insurance rates."

Buying more than one insurance policy with the same insurance company can lead to multi-car discounts, but it doesn't necessarily guarantee you're getting the best insurance rate available. You may be able to save money by purchasing separate policies with different providers.

At InsuranceRates.com, you can shop and compare car insurance rates from the comfort of your own home! Give it a it—it's quick, easy, and could save you money right away.