March 11th is Debunking Day, which makes it the perfect moment to clear up some of the biggest misunderstandings surrounding home and auto insurance. A lot of people make decisions based on outdated assumptions or half-true information, and those misconceptions can end up costing them when they need coverage the most.

To help you stay protected and confident in your policies, here’s a fresh look at eight persistent insurance myths—and the real facts you should know instead.

Myth #1: “Red cars are more expensive to insure.”

Many people believe that owning a red car comes with higher premiums, but the color of your vehicle has no effect on your insurance rate. Insurers focus on things like the make, model, year, engine size, safety features, where you live, how often you drive, and your driving record. Paint color simply doesn’t factor into the equation when determining your premium.

Myth #2: “I only need flood insurance if I’m in a designated flood zone.”

Living in a high-risk flood zone is not the only reason you may experience flooding. In fact, roughly one-quarter of all flood insurance claims come from people outside these areas. What surprises many homeowners is that standard home insurance policies do not cover flood damage at all. If rainfall is common where you live—even if flooding isn’t—having flood insurance is worth seriously considering.

Myth #3: “My older car doesn’t need full coverage anymore.”

It’s true that the value of older vehicles decreases over time, but that doesn’t automatically mean you should drop important coverage. Liability insurance is still required in most states, regardless of your vehicle’s age. And if you rely heavily on your car or wouldn’t be able to easily pay for repairs or replacement after an accident, keeping collision and comprehensive coverage may still be a smart move.

Myth #4: “My homeowners policy covers everything I own.”

Homeowners insurance does include personal property coverage, but it usually comes with limits tied to your home’s insured value. High-value items—such as jewelry, collectibles, art, or premium electronics—can exceed those limits. To protect items that are especially valuable or difficult to replace, you may need additional coverage or a separate endorsement that specifically lists them.

Myth #5: “Anyone who drives my car is automatically covered.”

While your policy may extend to drivers who occasionally use your car with your permission, it’s not unconditional coverage. Regular users, such as family members or a roommate who drives your car frequently, may need to be added to your policy. And if someone uses your car for business, delivery work, or ridesharing activities, your personal policy may not apply at all. It’s important to confirm these details before handing over the keys.

Myth #6: “I don’t need homeowners insurance because I have enough in savings.”

Even a strong savings account can’t always absorb the financial blow of a major loss. Homeowners insurance covers much more than the structure of your home. It also includes liability protection, coverage for personal items, and additional living expenses if you’re unable to stay in your home after a covered claim. Considering that rebuilding costs now exceed $320,000 on average, skipping insurance puts you at significant risk.

Myth #7: “My auto insurance always covers rental cars.”

Most personal auto policies offer some coverage for rental vehicles used for personal reasons. However, that coverage typically doesn’t extend to rentals used for work or commercial purposes. Before you say no to the rental company’s insurance, it’s wise to verify how your own policy applies—and under what circumstances.

Myth #8: “My credit score doesn’t affect my insurance rates.”

In many states, insurers use a credit-based insurance score to help determine your premium. This isn’t the same as your personal credit score, but it is influenced by your credit behavior. Because data shows a correlation between credit habits and risk, improving your credit may qualify you for lower premiums. It’s worth discussing with your agent if your score has improved recently.

Quick Tips to Prevent Coverage Gaps

A little preparation can go a long way in preventing unpleasant surprises when it’s time to file a claim. These simple steps can help you stay fully protected:

- Review your insurance policies yearly, especially after major life or property changes.
- Ask your agent to explain exclusions so you understand what’s not covered.
- Keep records of your personal belongings, including photos and estimated values, to simplify future claims.
- Learn the difference between “replacement cost” and “actual cash value” as each can affect your payout.
- Consider how you’d handle a sudden loss and whether your current coverage would be enough.

When You Should Revisit Your Insurance Policy

Your life doesn’t stay the same—and your insurance shouldn’t either. Consider taking a closer look at your coverage whenever:

- You buy or sell a home or vehicle.
- You complete a renovation or major improvement project.
- You experience life changes such as marriage, divorce, or welcoming a child.
- A teenager or new driver joins your household.
- You launch a business or side job that changes your risk profile.
- Your income, credit score, or financial situation shifts.

Whether you’ve fallen for one of these myths or you simply want to double-check your coverage, now is a great time to make sure everything still aligns with your needs. Staying informed will help you avoid costly gaps and feel more confident in your protection.

If you’re ready for a closer look at your policies, we’re here to help you navigate your options and make sure you’re covered where it counts.