5 car insurance myths debunked

September 26, 2019
A red car drives down a street

When it comes to car insurance, there are a lot of misconceptions that have surfaced over the years. But the problem with misconceptions is that the more people share them, the more people begin to believe they’re the truth.

 

Below are five of the top myths associated with your car insurance that we’re debunking once and for all. 

 

Myth #1: “Only I drive my vehicle, so only I need to be insured.” 

Truth: Anyone in your household who is a licensed driver potentially has access to your automobile. Therefore, your insurance company needs to be made aware of them so they can make sure they are acceptable drivers.

 

Myth #2: “Red cars cost more to insure than any other colour.”
Truth: Red, blue, purple, or green, no matter what the colour of your car, it will not impact your insurance rate. Instead, rates are based on the actual claims experience and the make and model of your vehicle. This includes the cost of repairs, the rate of injury, and the likelihood that a vehicle might be stolen or involved in an accident.

 

Myth #3: “My car insurance should be lower because my car is brand new.”
Truth: New vehicles often have better safety features to protect you and your passengers and include anti-theft devices, which make them less attractive to potential thieves. However, insurance rates are based on a combination of factors that must be considered. These factors include, but are not limited to:

 

  1. The claims history of the vehicle you drive — including all of the factors detailed in Myth #2
  2. Where you live — For those who live in larger urban areas, auto insurance rates can be higher. This is due to the greater number of vehicles on the road, which could increase the risk of accident. The larger population also could affect the number of vehicles that are stolen.  
  3. How much you drive — someone who commutes to work or uses their vehicle to visit clients, will often do more driving than someone who uses the vehicle strictly for pleasure. 
  4. Your driving record and driving experience — How long you’ve been driving, along with how many accidents you have been in where you were at fault, and the number of driving convictions on your record can alter your insurance premium. 
  5. The amount of optional coverage you purchase — You can work with your broker to determine the coverages that are best suited to your needs.
  6. The deductibles you choose — Higher deductibles can lower your premium — this is due to the fact that you will pay more towards the cost of repairing your car, with your insurance company paying less. 

 

Myth #4: “My insurance policy covers all types of weather events.”
Truth: If you have only the minimum coverage mandated by the provincial government   you are not covered for damage caused by any weather events. However, if you add Comprehensive coverage, you are insured for weather events, including windstorms, earthquakes, hail, tornadoes, and floods. Subject to the policy exclusions and certain endorsements that may be attached to the vehicle, Comprehensive coverage protects you from anything that is not considered “Collision or Upset”. This includes perils such as theft, attempted theft, vandalism, fire, and glass breakage.

 

Myth #5: “My car insurance won’t cover my cracked windshield.”
Truth: Here in Alberta, when the weather gets cold and it starts to snow, we use small pebbles coated with road salt and sand, called “pickle” to give our vehicles traction. Pickle has become infamous for causing cracked windshields across the province. In most cases, Servus Insurance Services – Home and Auto offers free repairs on windshield chips smaller than a toonie —and when the problem is caught early on, you do not have to pay your deductible.

 

There you have it. The truth. Now go ahead and buy the red, pink, or matte black car, and share your newfound knowledge with family and friends.

 

Visit our website for more information on auto insurance.

Disclaimer:

This article is provided for your general information only. Nothing on this site alters the terms or conditions of any insurance policy. Read your policy for a complete description of coverage and contact your insurance provider for coverage and policy details. Policy wording prevails.

Servus Insurance Services – Home and Auto (“SISHA”) is a division of Johnson Inc. (“Johnson”), a licensed insurance intermediary, and is a tradename operated under license in Alberta.  SISHA is not a subsidiary or affiliate of Servus Credit Union. This is not a solicitation by Servus Credit Union.

Home and auto policies sold through Johnson Inc. are underwritten by Royal & Sun Alliance Insurance Company of Canada (“RSA”) in Quebec and underwritten by Unifund Assurance Company (“Unifund”) in the rest of Canada. Auto insurance not available in BC, SK or MB. Home and auto insurance not available in NU. Johnson, Unifund, and RSA share common ownership. Eligibility requirements, limitations, exclusions or additional costs may apply, and/or may vary by province or territory.