Top Insurance Myths Debunked
Myth: A widely held, but false belief or idea. Think any exist in the insurance world? Absolutely, they do! This can cause you problems if you are misinformed and buy into some of these myths. We have put together some of the top widely believed insurance myths along with the real facts to help educate you.
Auto Insurance Myths
Myth #1 – Red cars are more expensive to insure.
Fact – The color of your car does not affect your rate.
Myth #2 – Small cars are the cheapest to insure.
Fact – Small and mid-size SUVs and minivans are generally the cheapest to insure. Small cars are not, often because they are driven by more inexperienced drivers who tend to make claims, and because passengers incur more expensive injury claims.
Myth #3 – New cars are more likely to be stolen.
Fact – Thieves actually prefer to steal older cars to sell them for parts.
Myth #6 – If I lend my car to a friend and they get into an accident, their insurance covers it.
Fact – When you lend your car out, you also lend your insurance. Your insurance will handle the accident.
Myth #5– Sporty cars are more expensive to insure.
Fact – A car being sporty does not affect the cost to insure. The likelihood it’ll be stolen, its repair costs, and how well it protects everyone from injury during a collision are the factors that influence insurance costs.
Home Owner’s Insurance Myths
Myth #6 – Your home owner’s insurance should only have coverage up to your home’s real estate value.
Fact – You should purchase coverage based on the cost to reconstruct your home, including materials and labor.
Myth #7 – My standard home owner’s policy covers flood insurance.
Fact – Home insurance does not typically cover floods. It depends on what caused the flood and your policy’s coverage. Typically, a separate flood insurance policy needs to be purchased in addition to a standard policy.
Myth #8 – My home owner’s policy covers all my valuables in my home.
Fact – Most homeowners’ policies have a limit on the amount of coverage of valuables. If you have possessions above that amount, you will need to purchase additional coverage. You can learn more about this additional coverage here.
Myth #9 – My premium will go up if I file a home owner’s claim.
Fact – Filing a single claim does not usually increase your premium, but filing more than one claim may. It is always best to run the numbers before filing a claim. If the cost to cover the damage is close to your deductible cost, it may wise to pay out of pocket, instead of filing a claim.
Myth #10 – If I injure myself at home, my home owner’s insurance will cover it.
Fact – The liability portion of a standard home insurance policy covers the medical expenses of guests who are injured on your property, but not you or any of your family members.
It is important to learn all the facts about insurance in order to avoid any mistakes and make sure you have sufficient coverage. If you have any questions or concerns about your coverage, don’t hesitate to contact the experts at Len-Balder today!