Posted on: Thursday, November 27, 2003

Misconceptions on auto insurance rates shared

By Justin Bachman
Associated Press

When it comes to the fundamentals of auto insurance rates, adults and teen drivers both have a few things to learn.

Quizzing a group of 1,000 teens and 1,000 adults, the nation's third-biggest car insurer found the two groups were about equally knowledgeable on the basics of what affects rates.

Nearly three of four teens didn't know that your credit history plays a role in how much you pay for auto insurance, while more than half of adults (63 percent) didn't know this.

Nearly a third of adults, 30 percent, said the color of a car would affect the cost to insure it. More than a fifth of teens, 22 percent, also believed color was used to set rates. It's not.

Fortunately, most people do know the importance of age and experience when paying for insurance. Only 2 percent of teens believed age is not a factor in setting rates, and 9 percent of adults were laboring under that misconception.

The online survey was conducted by Progressive Corp., based in Mayfield Village, Ohio.