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Don’t be taken by old wives tales and myths.
Insurance is very complex with many exclusions. We should always stay on top of it, be it Health or Life, Auto or Homeowners insurance. Make sure you know your coverage, avoid any gaps, so that there won’t be any surprises at claim time. If you do not understand your policy declaration - call your insurance agent and ask to explain and “walk” you step by step through the policy.
The biggest mistakes people make is by listening to what others tell or advise them. Even though the information might be wrongful. Once in a while we are all taken by the old wives tales. This happens when we are not well educated on a subject. Take auto insurance, for example. Here are some wrong assumptions people have, based on their bad knowledge or myths they’ve heard:
- believing, that auto insurance will go up or down because of the car’s color. Yes, colors have special meanings, but they do not influence our rates;
- auto insurance won’t be canceled, if we pay our bill late. It is not an apartment that you rent, which is going to be there, even if you are late on payments. In case of a car insurance - there is a cancellation;
- thinking that having collision coverage is enough. And what are you going to do if your vehicle will be damaged by fire or wind, or in case of a theft or glass breakage? Be safe and get both collision and comprehensive coverage;
- believing, that you are completely covered by your employer’s Business Auto policy, while driving a company car. Not exactly. You will be liable when using a car for personal use or injuring a coworker riding with you. To avoid it you have your Personal Auto insurance, which includes liability coverage automatically. As for a coworker, add an Extended Non-Owned Auto endorsement. It’s about $10 per year and problem is solved. In case you don’t own a car - buy a Named Non-Owner Personal Auto policy. Coworker would be covered automatically;
- some owners of small family-owned corporations insure car with a title under the corporate name (for tax purposes) under a personal auto policy. Big mistake. Personal auto insurance does not cover ownership or liability interest of unlisted vehicle owners, even if premiums were paid for the coverage;
- assuming that your newly purchased vehicle has automatic coverage. Yes - when test-driving a car. But it ends the day of a purchase.
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