How much do you really know about car insurance? This is one of those subjects that can end up costing you a lot of money if you cannot discern the truth from the myths. Do you think you can pick out the facts from the fiction about car insurance?
Earlier this year, I wrote a blog that emphasized some of the misinformation about car insurance that tends to travel around the internet. Some of these pieces of incorrect information have been repeated so often that they are starting to almost sound like facts. How much do you know about auto insurance? Take this quick quiz, and find out!
All car insurance policies automatically cover natural disasters and theft. True, or false?
False! Check and see if your car insurance policy includes comprehensive coverage. Not all of them do! This is because comprehensive auto insurance is an additional policy that a person pays extra for, in order for it to be added onto their standard car insurance policy. Comprehensive is the portion that covers things like theft, collisions with animals, and natural disasters.
Your credit score influences the cost of your car insurance premiums. True, or false?
This one is true, for the most part. Some states have made laws that forbid insurance companies from using a person’s credit score as one of the calculations that determines the price of their car insurance premium. However, there usually aren’t any actual laws that prevent insurers from taking a look at people’s credit scores. A study shows that the higher your credit score happens to be, the lower your car insurance premium will be.
You don’t need more auto insurance than your state requires you to buy. True, or false?
This one is false! The majority of states have made laws that require that all drivers purchase a minimum amount of car insurance. Unfortunately, if you go with the bare minimum, you could run into some problems. If you get into a serious accident, the cost of damages and medical bills could easily exceed the amount that your basic, minimalistic, auto insurance policy will cover for you. Basic car insurance might not cover all of your legal bills if you get sued by the other driver in an accident you were involved in.
Your car insurance will cover the vehicles that you rent. True, or false?
This happens to be true. Most auto insurance policies will cover your insurance needs on cars that you need to rent. It will give you the same coverage on your rental car as you have on the cars that you own. This means that you won’t necessarily have to purchase the rental insurance from the company that you rent the car from. Some of your credit cards could, potentially, sell you rental insurance too. Check and see what each one offers you, so you can get the best deal.
Image by Andrew Steinmetz on Flickr