Shopping around for a new car insurance policy? There are a few urban myths you should be wary of as you can end up investing into a policy which is not right for your car. So, differentiate between facts and fiction about car insurance policies and find out which features add on to your premium. It can help you save your money in long run.

Below are six most commonly circulated myths about motor insurance:

Myth: Red colored cars are more expensive to insure

False: Believe it or not it’s commonly assumed that red colored cars are more expensive to insure compared to any other color. This misconception has raised mainly due to the high-performance cars which are commonly red in color. Insurance companies aren’t as concerned about the color of your car.

Myth: My friend drove my car. His insurance will pay for my damages.

False: The insurance is for your car and in case of an accident you will be responsible for any damages incurred. You need to be careful about who is going to be driving your car.

Myth: It’s impossible to get car insurance if you’re under 25 years.

False: The general rule of thumb is if you have a car license you are eligible to get your car insured. However, the rate offered for a 18 year old holding a new driving license will be different from a 26 year old who has substantial experience.

Myth: Your rates will remain the same if you don’t report your accident.

False: So this is what happens when you get into an accident. The affected party will file a claim for the damages or injuries. The affected party’s company will then contact your insurance company which can eventually increase your premium. Apart from this, your fine for causing the accident will also be recorded in the traffic department.

[Related: Don’t understand your car insurance policy?]

Myth: Insurance policy covers business use of your car.

False: According to the clause mentioned in your insurance policy, your claims will be rejected if you were using your vehicle for business purpose even if you’re self-employed. If you wish to use your vehicle for business purpose you are required to get a commercial motor insurance policy which is generally more expensive compared to private.

Myth: Getting insurance from an agent or broker, the rates remain the same.

False: The rates offered by an agent and a broker will never be same. The reason is simple, an agent works directly with a specific insurance company whereas a broker works independently with several insurance companies. Therefore, a broker can offer better options rates and options that best suits your needs. On you can compare features and benefits of car insurance policies and make the right choice.