"I don't need comprehensive insurance for theft, because thieves don't steal old cars." Check out our Traffic Ticket Calculator to find out how various violations affect car insurance rates.
The type of infraction you're cited for by policy will help determine if your rates will go up, and if so by how much. If you are buying insurance for teen drivers, adding accident forgiveness may be money well-spent. Even if you are cited as being responsible for a minor accident, it is possible to get auto insurance with accident forgiveness built in. In fact, if the ticket was minor and you have an otherwise clean record, your premium may not increase. "I got a ticket, so my car insurance rates will skyrocket."Ī ticket doesn't automatically mean an increase in rates. "A $30,000 sports car could have costlier claims than a $50,000 SUV, so the sports car could cost more to insure," says Sal Orso, an assistant vice president of casualty underwriting for Chartis Insurance's private client group in New York. In fact, some mid-priced vehicles may have higher insurance premiums if they have a high loss history and cost more to repair than expensive ones. "A more expensive car costs more to insure."Ĭar insurance companies look at the “loss history” of your vehicle–meaning how many claims they’ve paid on that model-along with how much it might cost to repair or replace your car, not its sales price, when determining how much to charge you for collision and comprehensive coverage. Non-renewals happen for a variety of reasons, such as too many files claim. "While there are reasons companies can cancel insurance policies, they can't necessarily do it at any time," he says.Ĭar insurance providers can non-renew you, but this only happens at renewal time. However, if you're paying your premiums on time and have a valid driver's license, you have little to worry about, he says. Such grounds may include non-payment or fraud. State regulations prohibit insurance companies from dropping you in the middle of your policy term, unless the insurer has adequate grounds to do so, says Petrarca. "My auto insurance company can cancel my policy at any time." However, if your auto insurance coverage is maxed out, umbrella insurance can be a financial life-saver. So if I lend a vehicle to my brother, and he gets in an accident, it would go through my insurance company," she says. "For a personal auto policy, the insurance is generally going to follow the car, not the driver. "If you give someone permission to drive your car and that person crashes, it will be your insurance–not your friend's policy–that covers the damages," says Rebecca Doran, a senior corporate underwriter with Amica. "My friend borrowed my car, so he's responsible for damages." Review 's concise explanation of how auto insurance works.ģ. "Some makes and models generate more claims than others, and they're rated accordingly, but the color of a vehicle means nothing," he says. But the color of the car doesn't factor into the premium, says Petrarca. "The color of my car affects my insurance rate."Īuto insurance companies set rates based on the safety features of a vehicle and how much it costs to repair or replace the vehicle (among other factors about the driver). If another party is at fault, get their car insurance information so you can make a claim under their property damage liability coverage. No-fault is for medical bills, not property damage. If you're responsible, you need collision to fix your vehicle. The insurance companies determine who's to blame, and that party (and their insurer) are responsible for property repairs and other damages, he says. If you caused the wreck, it doesn't mean you're off the hook. "After an accident, no-fault insurance lets all parties get payment for their immediate medical needs while their insurance companies are deciding amongst themselves which company is going to pay for the accident," says Michael Petrarca, an assistant vice president at Amica Mutual Insurance Co. No-fault car insurance varies by state, but usually requires your auto insurance company to pay medical expenses and lost wages for injuries due to a car accident, regardless of who is at fault. "No-fault insurance means it's not my fault!" "My personal auto insurance covers both personal and business use of my car."ġ. "I recently paid my insurance premium, so I won't need a new policy for my new car." "The laptop in my car is covered by my auto insurance policy." "I got a ticket, so my car insurance rates will skyrocket."
"A more expensive car costs more to insure." "The color of my car affects my insurance rate."