Truth: "No-fault insurance" simply means that your own insurance company pays for your injury-related bills, regardless of who is at fault.
Truth: Your insurance company will determine whether your car should be totaled. A total loss is declared when the repair costs exceed a certain threshold of the car's present value. That generally falls between 50 percent and 70 percent, depending on the insurance company.
Myth No. 11 If my car is totaled, my insurance will pay off what I owe on my loan.
Truth: When your car is totaled, your insurer will pay you the actual value of your car (before the accident), minus your deductible. You are still responsible to your lending institution for any amount outstanding on the loan or lease. The only way to cover the difference between the car's actual value and the amount you owe on the loan is to purchase gap insurance.
Myth No. 12 My insurance will cover me if my car is stolen or vandalized.
Truth: Unless you have comprehensive coverage, you are not covered for these things. A bare-bones policy in most states is liability-only and will only cover damage you cause to others' cars. If you want to fully protect your vehicle from damage due to accidents, weather, crime and acts of God, you should have collision and comprehensive coverage.
Myth No. 13 Thieves are more likely to steal new cars.
Truth: It's actually the other way around. Statistics indicate that thieves actually tend to steal older cars. There are two primary reasons: 1) They are easier to steal and 2) They're more valuable on the used-car-parts market, which is particularly strong, especially in a down economy.
Myth No. 14 If items are stolen from my car, they are covered under my auto policy.
Truth: Generally, it's your homeowners or renters policy that protects anything stolen from your car.
Myth No. 15 Drivers of sports cars get more tickets and thus pay higher insurance premiums.
Truth: Not necessarily. A lot of other factors determine premiums. (A 35-year-old Corvette owner with a good driving record will probably pay less in premium than a 24-year-old Scion tC driver with points against his record.) According to a recent study by Quality Planning, a solutions consultant for automobile insurers, nine of the top 10 cars with the most traffic violations were non-performance models.
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