Steering clear of four auto insurance myths

BrokerLink's insurance brokers help customers through the auto insurance process. This includes educating drivers about which insurance coverage(s) they need and demystifying myths – incorrect auto-insurance assumptions – which cause confusion. Here are the truths to four auto insurance myths.

1. Myth: If the police don’t give out a traffic violation after an accident, a person’s insurance premiums won’t increase.

The truth: police do not determine who is responsible for an accident. Insurance companies use fault-determining rules to determine which party is going to be held responsible.

2. Myth: If a person doesn’t ride their motorcycle in the winter, they don’t need insurance.

The truth: theft, vandalism and unexpected damages can happen any time of the year. Having year-round insurance coverage helps handle the result of these events. Additionally, premiums are determined by how often a person uses their motorcycle, which is then used to create year-round coverage. As a result, cancelling an insurance policy during the off season would not save money.

3. Myth: To make sure a person gets enough money after a car accident, inflating the claim costs is acceptable.

The truth: it’s a crime to inflate the cost of a claim and is referred to as insurance fraud. The amount of compensation a person receives depends on the terms of the policy and the deductibles (the amount of money a person pays to receive the insurance coverage).

4. Myth: If a vehicle is determined to be a “write off” due to an accident, a person will get the full value of their vehicle back.

The truth: it’s unlikely a person will get the original value of their vehicle back when it’s deemed a “write-off.” In most cases, the person would get the actual cash value of their vehicle at their time of the accident – this accounts for the depreciation of the vehicle.

Get in the driver’s seat: learn more about auto insurance

For more information about auto insurance, take a look at our answers to commonly-asked auto insurance questions. To save money on insurance, drivers can also bundle their home and auto insurance policies together.