Read the following five insurance statements and guess if they are fact or fiction.

1). Collision and comprehensive coverage provide you the money to replace your car if it is totaled in a wreck in Dallas or any of the surrounding suburbs.

This is a common misunderstanding that gets a lot of people in a bad situation. While it is a great idea to have both, even with cheap auto insurance, it doesn’t mean you’re going to get a new ride if you have a wreck no matter what city or state you’re in. The age of your vehicle and how much it has depreciated since you bought it are what will make the difference on how much your insurance pays off.

2). Your cheap car insurance policy has a grace period if you’re late with your payment. So, your coverage is still in place when you’re late in Allen, Coppell, Frisco, or Plano.

Another common misunderstanding. It doesn’t matter if you have the cheapest auto insurance or the most expensive if you don’t make your payment on time, your coverage laps. It will be reinstated once you make the payment and any late fee that has been added.

3). The smaller the vehicle, the less prone to be in a crash in Dallas because they maneuver and navigate better.

This would be false! A smaller vehicle can’t withstand a collision like larger ones. This is really a matter of logistics. So, in this case, the bigger, the safer, even in the suburbs like Allen or Coppell. And because smaller vehicles have a higher rate of collisions, they often cost more to insure, even with the cheapest car insurance you can find.

4). My insurance company will not pay off my car loan if my vehicle is totaled.

Finally, a true statement! The amount you gave for your vehicle when you bought it is not what it will be worth later. So, if you have a wreck in Dallas or Plano and still owe on your car, you could be left with a balance to pay off on a vehicle you can’t drive.

5). A no-fault insurance means any accident isn’t your fault.

This is another misunderstanding about cheap auto insurance and even expensive auto insurance. Every state has different laws when it comes to auto insurance coverage, but the main gist of this means that your insurance firm will pay for any medical expenses and salary missed due to the accident regardless of who is the responsible party.