Car insurance is mandatory for all drivers in Canada. Which is why it’s not surprising that people are continuously generating myths around it.
Some of them at first glance are quite justified. The others, however, after a closer examination, only reaffirm our belief that people create these myths on the fly. Of course, they will try to convince others, even without having a strong argument to stand on.
Sure, you will try to find information on a variety of websites to see whether a particular myth is true or not. We want to save you some time that could be spent on something more useful. Mistakes can cost more money in the long run, so you need to be ready in advance.
In this article, we will try to dispel the most popular car insurance myths.
New cars are stolen more often than the older ones
Newer things should always attract thieves more often than the older one, right?
However, according to Insurance Bureau of Canada, within the list of the ten most popular cars for thieves, you can only find older models. Most of them were made between 2004 to 2010.
If you go deeper into this topic, you can find a lot of information about a massive flow of stolen, used vehicles that in half of the cases went to disassembly. This option allows thieves to sell individual parts of the car at a higher price. In this case, this myth is almost entirely demolished.
Also, many of the car owners in the event of theft less frequently reported about their stolen vehicle to police. We can only explain presume that they were already thinking about buying a new car at the time of the theft.
Women pay less for the car insurance than men do
To some extent this myth is true, but there are some nuances which are not well known by the general public.
Yes, men up to age of 25, according to statistics, pay a lot more than women. However, upon reaching this age, gender no longer plays a significant role in determining the amount of the monthly payment. This means that men and women will pay the same if their driving experience is the same.
Also, keep in mind the marital status of the person plays a significant role as well. Moreover, to many insurance companies, a person’s driving record plays a bigger role than gender.
It is necessary to consider all these facts when applying for insurance.
You will always pay more if you have had tickets and accidents
If you have multiple tickets or got into the crash accident, it is likely that you will have an increased monthly fee. Usually, tickets last up to three years, while car accidents last up to six years. However, now you can find companies that can forgive several minor violations or accidents. Moreover, they won’t increase the insurance premiums.
We recommend you to be a careful driver who follows all the rules of the road. In this case, you will always be on the safe side in all respects. And remember – a major incident will attract the attention of insurance companies. A parking ticket is unlikely to be the reason to be finished with driving once and for all.
The insurance company will always cover damage to my car
This is not always true. All damage received during the accident will be covered only if you have purchased collision coverage. It is an option, which is not included in most packages offered by the insurance companies. If the accident wasn’t 100% your fault, all damage would be covered as prescribed in the contract.
The insurance company will cover the entire amount of the stolen car
Another misconception, which is believed by a significant number of people. By default, the insurance company does not cover damage caused by vandalism, hail, fire, theft or accidents which involved wildlife (except some parts of Canada). For such cases, the insurance company offers superior surcharge coverage, which includes all of the above. Even with this extended coverage, full payment for the stolen car is not guaranteed.
All insurance companies have about the same rate
Each company may differ in its demands to the driver. They have their list of things which can affect the amount of the monthly payment. Also, the company will provide different rates depending on your city of residence. If you’re in the major cities, you’ll pay relatively high insurance premiums because of the greater probability of accidents. In small towns, you are likely to pay two times less.
Sometimes the price difference can vary up to a few hundred dollars, so we advise you to study the market and offers before making the final decision.
Higher rates and fees mean more vehicle coverage
The insurance company deducts the monthly payment amount differently for each client. Each one of them uses their own claims experience to determine premiums which are going to be paid by the driver. Your driving history and car model is taken into consideration as well. So, every year or two check your rates, to determine if it is the “right” company you’re dealing with right now.
No-fault insurance means that it’s not your fault
This depends on circumstances. There is always somebody at fault in a car accident. Also, there is a possibility that both drivers could be found guilty. Do not think that “no-fault” car insurance will automatically protect you from damage payments. If it was your fault, the insurance company could legally raise your rate. Even worse, you could pay the full amount for the car damage. However, If you are a victim of reckless driving, you can expect that your rate will not increase, even if your insurance company will cover all damages.