5 Myths that Don’t Let You Make the Most of Your Car Insurance
Most car owners know that it is legally mandatory for them to buy car insurance. Unfortunately, it is not so simple an affair. Getting a clear picture of the legal mumbo-jumbo of a car insurance and further getting past the myths and misconceptions around it can leave anybody completely tied in knots. It is thus understandable that many do not fully understand their car insurance terms and conditions and thus get deprived of taking full advantage of it. Here, we shed light on a few common myths and their reality check to help you reap maximum benefits from your vehicle insurance. Stay hooked!
Myth #1. Getting car insurance is a cumbersome and time-consuming process.
Reality- This is a completely baseless myth. In this internet-revolution era; buying and renewing a car insurance policy has never been easier. In an online form; all you need to do is type in the basic details about your vehicle and you. It is a smart idea to fill this form on a comparison website as you would immediately get quotes from various car insurers. You can compare and contrast them and even have telephonic conversations with their reps to iron-out your queries and doubts. Once you have decided on the insurer, you need to select it and follow the instructions to complete the procedure. In less than a day, you would have your policy in your mailbox. The paperless movement has made things far more convenient. Many insurance companies also offer you a Photo Quote option to renew your existing policy. All you need to do is click a photo of your existing policy and upload it. The rest of the process is similar. Online policies also come to you at a cheaper price.
Myth #2. You get the best car insurance deals only from car dealers
Reality- This is again a false myth. Most car dealers will offer you, car insurance included in the package deal. They sugar coat it in such a fashion that you feel you are offered the most cost-effective deal with maximum benefits. However, the truth is that most of the car dealers have tie-ups with specific car insurance companies who often pay them higher commissions. You can easily go online; compare various online car insurance quotes and benefits offered and then select the one that is most lucrative for you.
Myth #3. Transferring policy from one insurer to another would mean losing the No Claim Bonus.
Reality- The truth is that your No Claim Bonus always remains safe with you. To be clear, a No Claim Bonus is a reward given to you by the insurance company in case no insurance claim has been filed by you in the given year. Its amount is often substantial. Today, it is far easier to switch over your insurer as well as get your no claim bonus carried forward to your new insurer. The only care you need to take is to file for the transfer within 90 days of the expiry of your old insurance policy.
Myth #4. An accident caused by your friend who borrowed your car does not impact your insurance.
Reality- This is a totally false assumption. When you lend your car to your friend; you also lend your insurance. If an accident occurs; expect the car insurance companies to pick up the tab and put it under your insurance. Since it is the car that is covered; the insurance company would need to pay for accident damage, regardless of who drove the car. It is only in the rare event when the car insurance company is unable to cover all costs that the driver’s insurance kicks in. Thus, even if you lend your car; it is you who would be accountable at all times for the car.
Myth# 5.If the car is totaled; the insurance company will pay an amount equivalent to a new car
Reality- Unfortunately, this myth is also false. The insurance claim amount that you would receive is based on the principle of indemnity. This implies that your claim amount would revert you to the financial position you enjoyed before the accident. It will not improve your position. You would be given a fair price which would be equivalent to its current market value. When the value of your loss is calculated, the depreciation value is also deducted on your damaged car.
It is crucial to distinguish between car insurance myths and facts. Doing so will help you get the best coverage for your car and understand exactly what your policy covers and what is out of its boundaries.