Most drivers know they need auto insurance to be covered against financial losses after an accident. However, many aren’t sure how their policy actually works or what it actually covers. As a result, consumers often pass over the specific terms of their plan and instead opt to believe several misconceptions about coverage. To help you separate fact from fiction, here are five common myths about car insurance that you shouldn’t believe.  

5 Common False Beliefs About Car Insurance  

1. Minimum Liability Will Cover All Your Costs

Montana law dictates that all drivers must have liability coverage that provides $25,000 for bodily injury per person, $50,000 for total bodily injury, and $20,000 for property damage. However, this type of coverage only covers the harmed party for accidents that you cause. To cover damages caused to your vehicle during accidents that you cause, you’ll need collision coverage. If you want to be protected against theft, vandalism, and other damage that occurs while your car is parked, you’ll need comprehensive coverage.

2. Premiums Are the Only Cost to Calculate

When shopping for auto insurance, most people will focus on the cost of their premium to determine what their financial responsibility will be. However, you may be responsible for a deductible — the base amount you must pay to cover damages before your policy benefits kick in. Collision and comprehensive insurance typically carry a deductible, while liability coverage doesn’t involve a deductible.

3. You Don’t Need to Update Your Policy After Moving

Any time you move, you should update your policy to reflect your new address. Not doing so could invalidate any claims that occur after you move. Relocating to another state is especially important, as insurance laws vary from state to state.

4. You’re Not Responsible When Other People Drive Your Car

Insurance policies follow the vehicle, not the driver. As such, letting your friends drive your car isn’t always a good idea. Even if they’re insured, you may still be held liable for any accidents they cause with your car. Your policy may or may not cover these incidents, so it’s a good idea to check with your provider before letting anyone else get behind-the-wheel. 

5. Any Accident Will Increase Your Rates

Having a history of at-fault accidents will increase your overall risk as a driver, and in turn, your premium rates. However, that doesn’t mean all accidents will boost your costs. Incidents caused by other parties won’t typically be counted against you.

Supported by many of the nation’s leading carriers, The Insurance Exchange is a top resource for auto coverage that you can be trust. Providing specialized care to each client, this Kalispell, MT, insurance agency will also compare plans to help you choose the best option for your budget, as well as answer any questions you may have about coverage. Visit this agency online to learn more about their exceptional solutions or call (406) 756-2500 to request a free auto insurance quote.