Auto Insurance Secrets
There are some things auto insurance companies don't want their policyholders to know about. These auto insurance secrets can not only help you save money, but they can hep protect you from being taken advantage of by your insurance. Some of these secrets include the fact that your assets in your car are not protected should they be damaged in an accident, and that you must cancel your former policy when switching companies.
Read more
Secured with SHA-256 Encryption
Find the Lowest Car Insurance Rates Today
Quote’s drivers have found rates as low as $42/month in the last few days!
Table of Contents
Table of Contents
Head of Content
Meggan McCain, Head of Content, has been a professional writer and editor for over a decade. She leads the in-house content team at Quote.com. With three years dedicated to the insurance industry, Meggan combines her editorial expertise and passion for writing to help readers better understand complex insurance topics. As a content team manager, Meggan sets the tone for excellence by guiding c...
Meggan McCain
Licensed Insurance Agent
Justin Wright has been a licensed insurance broker for over 9 years. After graduating from Southeastern Seminary with a Masters in Philosophy, Justin started his career as a professor, teaching Philosophy and Ethics. Later, Justin obtained both his Property & Casualty license and his Life and Health license and began working for State Farm and Allstate. In 2020, Justin began working as an i...
Justin Wright
Updated July 2025
There are some things that auto insurance companies would rather their policyholders not know about. These “secrets” can not only help you save money, they can protect you from being taken advantage of by your insurer. A major part about being a smart consumer is to educate yourself on the product you are buying so that you make the right decisions. Continue reading below to learn about some auto insurance secrets that insurance companies know about, but the average consumer does not.
You May Be Paying More to Insure Your Vehicle
Not all cars will get the same coverage, for the same price. Not only is the cost of your car factored into your premium, but the make, model, safety features, and size of your vehicle are also considered. A fast and small roadster is going to cost you a fortune when compared to a sedan with all the safety features. The color of your car however, is not taken into consideration, contrary to common belief.
Free Insurance Comparison
Compare Quotes From Top Companies and Save
Secured with SHA-256 Encryption
Your Assets in the Car are Not Protected
If you have your laptop, iPhone, or any other item of value in the car with you during the time of an accident, and these items are damaged, chances are they aren’t covered by your auto insurance. There are special coverage types you can opt in to to get these things protected.
You Must Cancel Your Former Policy When Changing Auto Insurance Companies
When you sign up for a new policy, you are responsible for canceling your old policy. You can usually call in advance to have your coverage discontinued on a set date. If you don’t do so, you may end up having to pay 2 premiums at the end of the month.
Good Credit Goes a Long Way
Almost all auto insurance companies will pull your credit report when calculating your premiums. This is because your credit score is an easy way of determining your likelihood of filing a claim. Your credit score also says a lot about your ability to pay, and be a long term customer. This is one of the many factors that are used to calculate your insurance risk score. Your insurance risk score is not available to you.
Free Insurance Comparison
Compare Quotes From Top Companies and Save
Secured with SHA-256 Encryption
Paying in Advance Can Save You Money
You can pay for your auto insurance in a variety of ways. You can pay in monthly installments, semi-annually, or annually. The more you pay in advance, the more you can save. Each payment will cost you an administrative fee. If break up your payments into installments, these fees can add up. Try to pay your insurance in one-lump-sum to avoid these administrative costs.
You’re Responsible For Your Friends Too
Just because you weren’t driving at the time doesn’t mean you won’t have to file a claim and pay up. If you lend your car to a friend, and they get in an accident, you will have to file the claim with YOUR insurance company, not theirs. Either make sure your friends are insured through your existing policy, or tell them to get coverage of their own before you even think about giving them keys to your car.
Your Insurance Policy Assumes Everyone in your House is Driving your Vehicle
When you buy a car insurance policy, that policy will cover more than just you, the primary driver. Your car insurance policy covers everyone in your household – like roommates or family members who might drive your vehicle with your permission. Your car insurance company will analyze the risk of other drivers in your household when setting up your policy. If one member in your household has a DUI or an at-fault collision on his or her record, then you might pay significantly higher insurance rates. In this case, you can exclude a certain driver from your policy. You pay cheaper car insurance rates and that driver can’t drive your vehicle.
Free Insurance Comparison
Compare Quotes From Top Companies and Save
Secured with SHA-256 Encryption
You Can Switch Car Insurance Companies At Any Time
Many drivers are unaware they’re free to switch car insurance policies at any time. In fact, you can even cancel your auto insurance mid-policy and get a refund on the remaining months (in some cases). You may have to pay additional financing costs (if you’re paying for car insurance monthly). However, you’re free to switch to a new provider at any time. As long as you don’t let your car insurance lapse when switching policies, it’s a good idea to periodically shop for new car insurance and switch providers.
You Don’t Always Need to Add a Teen Driver to your Car Insurance Policy
Adding a teen driver to your car insurance policy can be extremely expensive. However, it doesn’t have to be expensive. In fact, in many states, you don’t need to add a teen driver to your insurance policy at all. If your teenage child is living at home and has a learner’s permit (not a full license), then he or she can drive your vehicle without making any modifications to your car insurance. You still have to abide by the rules of your learner’s permit (like having an adult in the vehicle at all times), but you don’t have to pay exorbitant teenage car insurance costs.
You Can Keep the Car Insurance Payout In Many Cases (You Don’t Have to Use it for Repairs)
If you’ve been involved in a car accident, then you might receive a payout from your insurance company. However, if the check is in your name, and you fully own your vehicle, then you’re not actually required to use that money on car repairs or replacements. You’re free to pocket the cash if you like. The only time you’re not permitted to do this is when you don’t own your vehicle outright (say, if you’re making car payments or leasing the vehicle) or if the insurance company’s check is made out to a car repair shop or the leasing company.
Free Insurance Comparison
Compare Quotes From Top Companies and Save
Secured with SHA-256 Encryption
More Auto Insurance Secrets
To learn even more about auto insurance, scroll around our site. We have a plethora of information in our Blog, Learning Center, and Glossary that can keep you occupied for hours and will make you an auto insurance expert in no time!
Frequently Asked Questions
What are some auto insurance secrets that insurance companies don’t want policyholders to know?
Auto insurance secrets can help policyholders save money and protect themselves from being taken advantage of by insurance companies. Some secrets include the fact that assets in your car are not protected in case of damage, and you must cancel your former policy when switching companies.
Are items of value in my car covered by auto insurance if they are damaged in an accident?
No, your auto insurance typically does not cover personal items of value, such as laptops or smartphones, that are damaged in an accident. However, there are special coverage types available that can protect these items.
Do I need to cancel my old policy when switching auto insurance companies?
Yes, it is your responsibility to cancel your former policy when you switch to a new auto insurance company. You can usually call in advance to have your coverage discontinued on a specific date to avoid paying for two policies.
How does my credit score affect my auto insurance premiums?
Most auto insurance companies consider your credit score when calculating your premiums. A good credit score can help lower your premiums as it indicates a lower risk of filing a claim and demonstrates financial responsibility.
What are the benefits of paying for auto insurance in advance?
Paying for your auto insurance in advance, whether semi-annually or annually, can save you money. By avoiding monthly installments, you can avoid administrative fees that accumulate over time, resulting in overall cost savings.
Related Articles
Get a FREE Quote in Minutes
Insurance rates change constantly — we help you stay ahead by making it easy to compare top options and save.
Secured with SHA-256 Encryption