What Are the Most Common Car Insurance Myths?
A-MAX Editorial Team
Reviewed by Jayson Cheves, Licensed Insurance Agent
Short answer
Common car insurance myths include that a red car costs more to insure, that credit never matters, that minimum coverage is always enough and that a friend's insurance pays if they crash your car. In reality, color doesn't matter, insurance usually follows the car, and leaving details off your application can backfire.
There's a lot of misleading information about car insurance online and through word of mouth. Some of it gets twisted so much that it sounds silly, yet people still believe it. Knowing what really affects your rate and your policy helps you make better choices. Here are some of the most common myths, cleared up.
Does the color of your car affect your insurance rate?
No. Many people think a bright red car costs more to insure, but insurance companies look at things like your car's make, model, year and safety ratings, not its color. You can even repaint your car without telling your insurance company.
Does your credit affect your car insurance?
It can. In many states, including Texas and Arizona, insurance companies may use credit-based information, along with your payment history, when they set your rate. California doesn't allow credit to be used this way for auto insurance. Rules vary by state, so it helps to know where you stand before you shop.
If your credit isn't great, don't let that stop you. A-MAX shops multiple carriers, including ones that work with drivers in all kinds of situations.
Is minimum coverage always enough?
Not always. Some people pick the most basic policy and assume they're better off. But if you cause a serious accident, minimum limits can run out fast, and you could be stuck paying the rest out of pocket. Your state sets the minimum you must carry, but it's worth asking whether higher limits make sense for you.
If a friend crashes your car, whose insurance pays?
A lot of people think the driver's insurance pays. In most cases, insurance follows the car, so the car owner's policy is usually the first to pay. That claim can also affect your rates later, even though you weren't driving. Be careful about who you let drive your car.
Do older drivers and veterans pay more?
Not necessarily. Some carriers offer discounts for groups like veterans and mature drivers. Ask whether you qualify for any discounts when you get a quote.
Is it okay to leave small details off your application?
No. A small white lie can cost you a lot. If an insurance company finds out you left out details, like past tickets or a gap in coverage, it can cancel your policy or deny a claim. Being upfront is always the safer move. Remember, past tickets or a lapse don't mean you can't get covered.
When you shop for car insurance, ask what goes into your rate, which discounts you may qualify for and what coverage makes sense for you.
How A-MAX can help
Have questions about your rate or coverage? Walk into one of our 240+ offices in Texas, California and Arizona, or call 1-800-921-AMAX. We shop. You choose.
About this page
Written by the A-MAX Editorial Team. Reviewed by Jayson Cheves, Licensed Insurance Agent. We review and update it as state rules and carrier availability change.
Last updated October 29, 2026
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FREQUENTLY ASKED QUESTIONS
In most cases, insurance follows the car. If someone else drives your car with your permission and gets into an accident, your policy is usually the first to pay, and that claim can affect your rates.
Yes. Depending on your state, credit may affect your rate, but it doesn't stop you from getting covered. A-MAX shops multiple carriers to help you find a policy that fits your situation.
If the insurance company finds out, it could cancel your policy or deny a claim when you need it most. It's always better to share your full driving and insurance history upfront.
Some carriers offer discounts for veterans, military members and mature drivers. Availability depends on the carrier and your state, so ask your agent which discounts you may qualify for.
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