Auto insurance is an important subject that almost everyone needs to know about. But since it’s a huge subject, it can be easy to have misconceptions that can negatively affect your overall experience. Fortunately for all of us there are experts, like AMA Insurance Advisor Cassandra Paliwoda, who we can talk to and help dispel any mistaken beliefs about our insurance that we may have. We talked to Cassandra and she told us about five major misconceptions she routinely finds that people have about their auto insurance.
The Cost of Your Premiums Are Set in Stone
There’s no doubt that auto insurance is a major expense for most drivers, but many people aren’t aware that there are several ways to lower your premiums. Some can do it instantly, while others are achievable overtime. Check out this article about several of the easiest options.
Mandatory Coverage Protects Your Car from Theft and Other Forms of Damage
Auto insurance consists of four different kinds of coverage. Third Party Liability (which covers the physical and material damages that occur to someone else when you’ve caused an accident) and Accident Benefits (which covers the costs of physical injury to yourself, your passengers, or a pedestrian after an accident) are mandatory for anyone who wants to legally drive in Alberta, while the other two—Collision and Comprehensive — are voluntary.
The problem is that a lot of people assume that the issues covered by Collision and Comprehensive are taken care of by their mandatory coverage, so they’re surprised to find out that without those two voluntary options their vehicle isn’t covered for theft, fire or vandalism. They also are often unaware that if they cause an accident and they don’t have Collision coverage, their Third Party Liability will only cover the damage done to the other driver’s vehicle — they will have to pay the full cost of their own repairs by themselves. So, even though you can legally drive without Collision and Comprehensive, you’re much safer and more fully protected with them.
You Only Have to Deal With Your Insurance Company After an Accident
Another way your insurance experience can be affected by the decision to only purchase mandatory coverage is if your car is damaged in a collision.
Without Collision coverage, you would have to personally deal with the at-fault driver’s insurance company to get them to reimburse you for the damage to your vehicle. With Collision coverage, your insurance company will pay to fix your vehicle and then collect back from the at-fault driver or their insurance company.
It’s Safe to Skip the Family Protection Endorsement
Endorsements amend your coverage. Some endorsements add extra protection that not everyone feels they need, but—inthe case of the Family Protection Endorsement — we strongly recommend it, even if it is an added expense. That’s because it protects you in instances where you’re the victim in an accident where the liable driver either doesn’t have insurance or is too underinsured to fully cover your damages/medical costs. Going without it may save you a few dollars on your premiums, but the potential risk is just not worth it.
Traffic Offences Only Affect Your Premiums for One Year
People commonly assume that because the demerits attached to their licence after they’ve committed a traffic offence expire after a year that the same is true for how long those offences affect their insurancepremiums. But that isn’t the case at all. The reality is a traffic offence can negatively affect your premiums for two full years if it’s minor and four years if it’s criminal. Which is a very good reason to drive as safely as possible!
It’s okay if you’re not an insurance expert — that’s why we have 124 of them right here in Alberta for you to talk to whenever you need them! Feel free to reach out whenever you have any questions. They’re always happy to talk and help make sure your policy keeps you as safe and protected as possible.