Alabama Car Insurance: Myths and Misconceptions

Jul 21, 2013 - Car Accidents by Cross & Smith

Every driver should have auto insurance because it is required by law. However, there are a lot of things that many people just don’t understand about their policies. Unfortunately, this can lead to confusion and problems in the event that an accident happens. 

Our Birmingham injury attorneys know that understanding your insurance coverage is important to protecting your rights and making informed decisions. A good place to start is to consider some of the myths and misconceptions about auto insurance recently discussed by the Digital Journal.

Some Common Auto Insurance Misconceptions

• The myth that an insurance agent always works to get you the best deal. This is not necessarily true as the broker works for specific companies. You may be able to do better on car insurance by shopping around with a broader range of different insurers.
• The myth that damage due to avoiding an animal isn’t your fault. Many people think that if they swerve to avoid hitting a deer in their path, they will not be to blame if they cause an accident. This is wrong. You can still be considered at fault with your insurer, you can still be legally liable and your insurance premiums can still go up.
• The myth that you will be paid enough to pay off your car if your vehicle is a total loss. Your insurer is only going to pay for the book value of your car and if that is not enough to pay off your loan, you will have to come up with the money for the bank yourself. You can avoid this by taking an additional “gap” insurance policy that would cover the difference between what you receive from the insurer and what you owe.
• The myth that an accident won’t increase your premium if you don’t make an insurance claim. The other person in the crash may make a claim for injury or damages and this could raise your insurance premiums. Furthermore, if you get a ticket in the accident, this can show up on your driving record and your insurance can go up.
• The myth that you can always get a rental car after an accident. You will get rental insurance from your insurer only if you purchased this type of coverage when you buy your policy.
• The myth that accident forgiveness coverage will not raise your premiums if you get into an accident. The fine print of these clauses may limit when they apply and you could end up with higher insurance premiums if you ever need to switch to a different insurer.

Understanding these myths can help you to understand how insurance works. You also need to remember that insurance companies are focused on protecting their bottom line and profits and not necessarily on ensuring that injured victims get full coverage for their losses. As such, you need to be careful in your dealings with an insurer after an auto accident and you may wish to be represented by an experienced attorney who can help you to ensure you get what you are entitled to from the insurer.