Ten Auto Insurance Misconceptions

Auto insurance is an essential aspect of car ownership. However, many things need to be clarified surrounding auto insurance that can lead to confusion and financial loss. This blog post will discuss the ten most common misconceptions regarding auto insurance.

Misconception 1: 

The color of your car affects your insurance rates.

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Many people believe that the color of their car affects their insurance rates. However, this is not true. Insurance companies do not consider the color of your vehicle when determining your insurance rates.

Misconception 2: 

Your insurance will cover any damage to your car.

While auto insurance does provide coverage for damage to your car, it is important to understand the limits of your coverage. Most insurance policies have deductibles, meaning you will be responsible for paying a certain out-of-pocket amount before your insurance coverage kicks in.

Misconception 3: 

Your insurance rates will automatically increase after an accident.

While it is true that accidents can lead to an increase in your insurance rates, it is not always the case. The severity of the accident, who was at fault, and your driving record are all factors that insurance companies consider when determining your rates.

Check out a previous article more information on what to do after an auto accident.

Misconception 4: 

Your insurance will cover stolen items from your car.

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While auto insurance provides coverage for the theft of your car, it does not cover any personal belongings that may have been stolen inside your vehicle.

If you have a homeowners insurance policy, the Personal Property coverage on your policy may extend to provide coverage for stolen items, subject to your deductible.

If you currently rent a home or apartment, the Personal Property coverage from your renters insurance policy may provide coverage, also subject to your deductible.

For more information regarding Renters Insurance and the benefits of having a policy, click here.

Misconception 5: 

You don’t need insurance if you only drive occasionally.

Even if you only drive occasionally, it is still essential to have auto insurance. Accidents can happen at any time, and without insurance coverage, you could be responsible for paying for any damages or injuries out-of-pocket.

Also, most states require at least a minimum amount of liability coverage to legally drive a vehicle. Proof of insurance is required to register a vehicle, and renew the registration on an annual basis.

Failing to have coverage in place may result in fines and additional insurance costs in the future.

Misconception 6: 

Your insurance rates will be the same no matter where you live.

Where you live can significantly impact your insurance rates. Factors such as crime rates, traffic congestion, and weather conditions can all affect your rates.

Misconception 7: 

Your insurance will cover damages caused by natural disasters.

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While some auto insurance policies may cover damages caused by natural disasters, it is important to review your policy to understand what is covered.

Other Than Collision coverage (otherwise known as Comprehensive coverage) is the coverage that is added to an auto insurance policy to allow for most weather related damage to a vehicle. There will likely be a deductible involved, which is the amount you would have to pay out of pocket in the event of a claim.

Misconception 8: 

Your insurance will cover damages caused by a friend or family member who borrows your car.

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Your insurance policy will likely provide coverage if a friend or family member borrows your car and causes an accident. However, it is important to understand that any claims made on your policy may increase your insurance rates.

Misconception 9: 

Your insurance will cover damages caused by acts of terrorism.

Most auto insurance policies do not provide coverage for damages caused by acts of terrorism. To protect against this type of event, you may need to purchase additional insurance coverage.

Misconception 10: 

Your insurance will cover damages caused by intentional acts.

If you intentionally cause damage to your car, your insurance policy will not provide coverage. Additionally, if you intentionally cause damage to someone else’s car, you will likely be responsible for paying for the damages out-of-pocket.


In conclusion, understanding the facts about auto insurance is essential to make informed decisions about your coverage. Dispelling these common misconceptions ensures you have the right coverage to protect yourself and your vehicle.

As in most cases, taking the time to sit down with your agent and review the coverages available to you is important as changes arise.

Brian Blakely

Brian is the Director of Property & Casualty at Stonebridge Insurance

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