Believe it or not, there are many common misconceptions about insurance. A popular one is the idea that, if you drive a red car, you pay more for your auto insurance than someone who drives a car of a different color. The truth is, the color of your car has absolutely no affect on the cost of your auto insurance. What does determine how insurance premium (what you pay) is the age of the vehicle, the make, and the model. Additional factors may be your credit history and where you live.

If your car suffers damage in an auto accident, your insurance will automatically provide you with a rental car.

Rental Reimbursement is an optional coverage apart from your standard auto policy. It must be purchased separately and added as an endorsement to your auto policy.

If your car is deemed a total loss in an accident (when it costs more to restore your vehicle to its pre-accident state than the actual value of the vehicle), you are no longer required to make your car payments.

We have both good news and bad news in a situation like this. The bad news is that your car’s value depreciates as soon as your drive it off the lot. As a result, if you are involved in an accident, it’s possible that the value of the car is less than the cost to restore it to its original state. Ask one of our insurance agents about how gap coverage can help you in paying off a balance you may still owe on your car.

Your landlord’s insurance policy covers your personal belongings.

Typically speaking, your landlord’s insurance policy will only cover the structure in which you live. Your personal belongings must be protected by your own renters insurance policy. To ensure that you get as much money as possible to recover your lost or damaged items, seriously consider doing an inventory that states, in detail, what each item is worth. In order for your insurance company to reimburse you properly, it’s best to have this inventory completed before the time of the loss.

Homeowner’s insurance only needs to cover the market value of your home.

The easiest way to avoid having to think about construction and labor costs in case your home is destroyed, talk to one of our agents about Guaranteed Replacement Cost. It’s the best kind of coverage when it comes to rebuilding your home back to its original state.

Floods are covered under a homeowner’s insurance policy.

False. Flood Insurance is handled by FEMA. If you either live in a flood zone or have a mortgage on your home, you are required to have flood insurance.

If your belongings are destroyed, your insurance will buy you all new stuff.

If your personal belongings are destroyed in a disaster such as a fire, you are going to need new stuff. When it comes to replacing your lost items from a covered claim, make sure that you have Replacement Cost Value Coverage on your policy because it’s the only way you’ll be able to have your insurance cover the cost of a new television. If you have Actual Cash Value instead, it means that your insurance will give you the value of what it deems to be the cash value of your television at the time of the loss. For instance, if you have a television that is ten years old, obviously, that television’s value is going to be less now than it was when you first bought it ten years ago. Don’t put yourself in a position where you’ll get Actual Cash Value for your loss.

You will always be paid the stated value for your “scheduled” items.

If you have items “scheduled” on your insurance policy, there’s a chance they may only be covered by the current Replacement Cost Value up to your stated limit on your policy. Ask one of our agents about your options when it comes to coverage limits.

You don’t need an insurance agent.

When it comes to covering your most valuable possessions like your home, your cars, your business, and even your life, it’s probably a better idea to let an experienced insurance agent give you the guidance you respectfully deserve rather than relying solely on yourself. Call us today! 301-948-2010 We’re here for you!