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Auto insurance is a complex thing, and it’s only natural that a lot of untrue rumors would float around about it. But if you want to get the right kind of policy at a good price, you need to cut through all that and stick with the facts. Here’s a quick list of some of the more widespread rumors that aren’t at all true.

The person who caused the accident isn’t necessarily the one to bear the whole financial weight of it! Sure, there’s nothing wrong with being nice and letting people borrow your car for a quick ride. But if they get into an accident, it’ll be you paying for it, since it’s your name attached to the vehicle’s insurance policy. Remember that you are responsible for how your vehicle is used and what happens to it. Don’t be afraid to say no sometimes, or ask people to be especially careful about certain things.

Your car insurance rates don’t go up and down in the same ways that mortgages or car loans do! It’s a different kind of policy, and is affected by different kinds of things. Auto insurance companies are in direct control of the rates on their policies. However, the state of the competition in the industry of auto insurance does have an indirect effect on your rates, as your company may have to tweak their rates up or down. If they become noticeably high compared to other companies, customers will jump ship, after all. And if they go too low, they’ll have a monopoly on their hands, and the government frowns on such things.

Collision coverage isn’t the only thing you could need from your insurance policy! Besides the legally required liability coverage, collision coverage is one of the most common kinds of coverage and people sometimes feel that it’s all they need. However, collision has some pretty significant loopholes in it. It won’t protect your car in cases of weather damage, theft, fire, or vandalism. If you live in an area where some or all of these things are common, you’ll want to spring for comprehensive coverage along with your collision coverage. It costs more, of course, but if you’re likely to need it, the cost is worth it.

The color of your car doesn’t influence your insurance rates! However, many other things do. Credit history is one thing to take into account. You want to be seen as reliable not just as a driver, but also financially as well. The type of your car, such as the model, body type, and engine size also matters, beccause these details are used to determine whether or not a car is on the ‘risk’ list for high likelihood of theft and other dangers. Flashy cars are high risks, while subdued ones are less risky and therefore less costly to insure. The most significant factor is your history as a driver. If you’ve proven to be reckless while riving, you’re going to pay for it when you get a new insurance policy. So don’t fall for all the myths out there. More than anything else, being a responsible, financially stable driver in a sensible car is what matters for getting good insurance rates.

Graham McKenzie is the webmaster for a leading South African Car Insurance provider. For more information visit: http://car.insurance123.co.za/

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