Your choice of auto insurance affects both your wallet and your peace of mind, yet far too many drivers still rely on outdated myths when buying policies. These false beliefs not only waste your hard-earned cash but can leave dangerous gaps in your coverage when accidents happen. Let’s cut through the confusion, discover the truth about car coverage, and separate those auto insurance facts from fiction.
Myth 1: The Color of Your Car Affects Your Insurance Costs
That shiny red car costs more to insure, right? Wrong. This long-standing myth has been passed down through generations, usually by well-meaning relatives warning you against buying that flashy crimson sports car. The logic might be sound — after all, red cars stand out more and might catch the attention of both criminals and law enforcement. However, in reality, your car’s paint color has zero impact on what you’ll pay for insurance.
In fact, insurers don’t even ask what color your car is when calculating your premiums. What they do care about is where you live, how old you are, your driving record, how far you drive, and what make and model you own. These factors can all affect claim frequency, repair costs, theft probability, and accident severity — measurable risks affecting payouts. Insurers calculate your risk level based on these sorts of factors, and your rate mirrors that risk. A red Civic and a white Civic with identical specs will cost the same to insure for similar drivers.
Myth 2: Older Drivers Always Pay More for Insurance
Many people assume that getting older automatically means their car insurance premiums will increase. It’s a common myth tied to unfair assumptions about older drivers’ abilities, including slower reflexes and eyesight problems, leading to higher crash risks. But the truth is that older drivers aged 55+ often pay less than younger ones. In fact, some reports suggest that drivers aged 55 to 64 pay premiums 10% below the national average.
Age alone doesn’t set your premium — your personal risk profile does. Older drivers are more likely to have clean records, drive less, and make smarter driving choices based on decades of experience. Many insurers even offer discounts to senior drivers with low annual mileage needs or who have taken defensive driving classes.
Myth 3: Full Coverage Means Complete Protection
The term “full coverage” can fool many drivers into thinking they’re protected against every eventuality. The myth that full coverage means complete protection creates a false sense of security, with many customers shocked to discover the gaps in their coverage when it comes time to file a claim.
In reality, full coverage just means a policy that combines liability, collision, and comprehensive protection. However, these policies won’t help you with intentional damage, routine maintenance, or wear and tear. A full coverage policy might also leave you without uninsured motorist protection, roadside assistance, gap insurance, or rental car reimbursement. Make sure to always check the actual coverage details instead of making assumptions based on a label.
Myth 4: You Only Need Minimum Liability Coverage
Opting just for state-required minimum liability coverage can seem like a good way to stay legal while keeping costs down. However, this is a risky move, as it leaves you with minimal financial protection in the event of a serious crash. Medical bills and car repair costs can easily exceed the maximum that liability policies will pay out, leaving drivers exposed to huge out-of-pocket expenses.
Illinois law mandates liability limits of $25,000 for bodily injury per person or $50,000 per accident, plus an additional $25,000 for damage to another’s property. Most experts suggest paying for coverage that raises these limits to $100,000/$300,000/$100,000. This is likely to cost just a few dollars more per month while providing you with much better protection.
Myth 5: Your Credit Score Doesn’t Impact Your Premium
Many drivers are surprised to learn that their credit score affects their car insurance rates. In fact, one study showed that drivers with poor credit paid roughly 109% more than those with great credit. Insurers argue that having poor credit is linked to more frequent, higher-value claims. You can lower your insurance rates by improving your credit score through paying bills on time and reducing your debt.
Making Informed Auto Insurance Decisions
Now that we’ve separated the car insurance fact from fiction, you can make smarter coverage choices that are beneficial for both your wallet and peace of mind.
Ready to make decisions based on facts instead of myths? Here at American Auto Insurance, we can help provide you with straightforward information about your options, whether you need liability insurance, collision coverage, an SR-22 policy, or something else. Get a personalized quote today or call 773-286-3500 to talk with an experienced agent.
Red Alfa Romeo C4 on Road Near Trees by Pixabay is licensed with Pexels License
