5 Car Insurance Myths—Busted!
Ever heard that red cars cost more to insure? Our auto expert sets the record straight on five of the most common car insurance myths.
Car insurance myths you need to stop believing
Do you know what factors really affect your auto insurance rates? Is it the colour of your car? Your gender, perhaps? What's troubling about many of these car insurance myths is how much money they can cost you in the long run. Here are five of the costliest car insurance myths—busted!
Are red cars more expensive to insure?
One of the most popular car insurance myths is that red cars are more expensive to insure. "Nobody asks for the colour of the car when you're getting a quote," says Alexey Saltykov, co-founder and CEO of InsurEye, an insurance comparison website. The make, model and year of your vehicle, as well as your claims history, will affect your insurance rates—not the colour.
Psst—these are the most popular car colours in Canada.
If you're loyal to an insurer, will you pay less over time?
When it comes to car insurance, it's always in your best interest to shop around for a good deal. "Sometimes you can save up to half of what you're paying [by switching insurance providers]," says Saltykov. Remember: insurance companies target different demographics, so if you're 55 and over, you can save more by getting insurance from a company that caters to your age group.
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Do higher rates mean more coverage?
When you compare car insurance plans, you'll see huge differences in price. Often times, that price difference reflects how the insurance companies are structured, and aren't directly related to the amount of coverage you'll receive. "Some companies work with brokers, so they have to pay commission. Others work through contact centres so they have to take into their policies the cost to cover [the centre]," Saltykov says.
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Are age and driving experience the main factors for insurance quotes?
Although age and driving experience are both important, car insurance companies look at many factors, including the coverage you want and where you live. Some locations may have more claims than others, and that affects the cost of your quote. Rates drop around age 30 on average, but it also depends on when you got your license.
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Do men pay more for insurance than women?
While men do tend to pay a little more in insurance than women on average, it's not strictly down to gender, says Saltykov. Since men tend to have more traumatic vehicle accidents than women, it could be because of higher claims made by men. "A quote always depends on an individual profile of each person and one cannot say that a woman will always pay less than a man," Saltykov says.
Next, find out 12 more car myths you need to stop believing.