The most common auto insurance myths in Louisiana: that "full coverage" actually covers everything (it doesn't), that state minimum liability is enough to protect you (it isn't), that your rate can't go up if an accident wasn't your fault (it can), and that red cars cost more to insure (they don't). There are also widespread misconceptions about whether insurance follows the driver or the car, whether you need uninsured motorist coverage, and whether getting a quote hurts your credit. These myths cost Louisiana drivers real money, either through gaps in coverage they don't know about or through decisions based on things that simply aren't true. Here are seven of the biggest ones and what's actually going on.
"Full Coverage" Means Everything Is Covered
"Full coverage" is not an actual insurance term. This is the myth we hear more than any other, and it's the one that causes the most confusion. You won't find it in any policy document, any state regulation, or any carrier's product listing. It's informal shorthand that the industry has used for decades, and it means something much narrower than most people think.
When someone says "full coverage," they usually mean a policy that includes liability, comprehensive, and collision. That's it. Liability covers damage you cause to other people and their property. Comprehensive covers things that happen to your car that aren't collisions, like theft, hail, a tree falling on it, or hitting a deer. Collision covers damage to your car when you hit something or something hits you.
That's the whole package. "Full coverage" doesn't include uninsured motorist coverage, rental car reimbursement, roadside assistance, gap coverage, or medical payments beyond your state minimums. Those are all separate coverages you have to add.
The reason this matters in Louisiana specifically is that lenders require comprehensive and collision coverage on financed vehicles. So when a lender tells you "you need full coverage," they mean comprehensive and collision on top of your state-required liability. But people hear "full coverage" and assume they're covered for everything. They're not.
If you're carrying what you think is "full coverage," pull out your declarations page and look at what's actually listed. You might be surprised by what's missing. Your auto insurance policy is only as good as the specific coverages on it, not the label someone gave it.
Louisiana's State Minimums Are All You Need
Louisiana requires every driver to carry at least 15/30/25 in liability coverage. That breaks down to $15,000 per person for bodily injury, $30,000 per accident for bodily injury, and $25,000 per accident for property damage. Those limits are far too low to cover a serious accident, and they haven't changed in years.
Here's the math. The average bodily injury claim in the U.S. is over $28,000. That's already more than your per-person limit if you're carrying state minimums. And Louisiana's accident profile makes this worse: 49% of vehicle accidents in the state result in bodily injury claims, nearly double the national average. Louisiana represents 1.4% of the country's population but accounts for 3.65% of all bodily injury claims nationwide.
On the property damage side, $25,000 doesn't go far when new vehicles routinely cost $35,000 to $50,000 or more. If you rear-end someone driving a new truck and total it, you're personally on the hook for everything above that $25,000 limit. That's not a hypothetical. It happens constantly.
State minimums exist to get you legally on the road. They're not designed to actually protect you financially. In Baton Rouge, where the average auto premium already runs about $262/month, drivers carrying only state minimums aren't saving much but are taking on a lot more risk. In New Orleans and Lafayette, where traffic density and claim rates push premiums even higher, the gap between minimum coverage and actual exposure is even wider. If you cause a serious accident with only 15/30/25 coverage, you could face a lawsuit for the difference, wage garnishment, or both. For drivers who want a broader safety net, an umbrella policy can add an extra layer of protection on top of your auto and home coverage. We wrote more about Louisiana's auto insurance requirements if you want the full breakdown.
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Red Cars Cost More to Insure
They don't. This is probably the most widespread auto insurance myth in the country, and it has zero basis in reality. Insurance companies don't ask what color your car is, and they don't factor it into your rate. When you get a quote, you're asked for the year, make, model, and VIN. Color isn't part of it.
What actually affects your rate is the vehicle itself. A car's safety ratings, crash test performance, theft rates, and repair costs all matter. A Honda Civic is cheaper to insure than a BMW 3 Series, but that's because the BMW costs more to repair and has different claims history. Paint color has nothing to do with it.
The myth probably started because people associate red cars with sports cars, and sports cars do cost more to insure. But that's because of the car, not the color. A red Toyota Camry and a silver Toyota Camry cost exactly the same to insure.
Your Rate Only Goes Up When an Accident Is Your Fault
Yes, your rate can go up after an accident that wasn't your fault. In most states, including Louisiana, insurance companies are allowed to surcharge for not-at-fault claims, and this one catches a lot of people off guard. Only two states, California and Oklahoma, have laws that specifically prohibit carriers from surcharging for not-at-fault claims.
A Consumer Federation of America study found that moderate-income drivers saw an average rate increase of 9.6% after a not-at-fault accident. That works out to roughly $200 more per year. Some carriers increased rates by 10% or more, while others didn't surcharge at all. The practice varies by company, and most people don't find out until their renewal hits.
The logic from the carriers' side is that a claim is a claim. Whether it was your fault or not, a driver with recent claims history is statistically more likely to file another claim. It doesn't feel fair, but that's how the underwriting math works.
This is something worth knowing before you file a claim for a minor fender bender that wasn't your fault. If the damage is close to your deductible, the payout might not be worth the potential rate increase that sticks with you for three to five years. That's a conversation worth having with your agent before you call it in.
Your Insurance Follows You, Not the Car
In Louisiana, auto insurance follows the car first, then the driver as secondary coverage. This is the opposite of what most people assume.
If you lend your car to a friend and they get into an accident, your insurance is the primary policy that responds, not theirs. Your deductible, your limits, your claims history. The friend's own auto policy might kick in as secondary coverage if the damages exceed your limits, but your policy is on the hook first.
This matters for a few reasons. If your friend causes $40,000 in damage and your policy has $25,000 in property damage liability, your carrier pays the $25,000 and your friend's carrier might cover the remaining $15,000. But the claim goes on your record, not theirs.
It also matters because some carriers are cracking down on permissive use. If you regularly let someone drive your car and they're not listed on your policy, your carrier could deny a claim or non-renew your policy. The safest approach is to list anyone who regularly drives your vehicle on your policy, even if they have their own insurance elsewhere.
You Don't Need Uninsured Motorist Coverage
Louisiana is one of only a handful of states that requires uninsured/underinsured motorist (UM/UIM) coverage by default on every auto policy. The only way to not have it is to reject it in writing. There's a reason for that.
According to the Insurance Research Council, about 11.7% of Louisiana drivers have no insurance at all. But the bigger number is this: 35.6% of drivers in the state are underinsured, meaning they carry coverage but not enough of it. That's more than double the national average of 15.7%. Combine those two groups and roughly one in three drivers on Louisiana roads doesn't have enough insurance to cover the damage they could cause.
If one of those drivers hits you, your UM/UIM coverage is what pays for your injuries and vehicle damage. Without it, you're left suing an uninsured or underinsured driver who probably doesn't have the money to pay a judgment anyway.
Some people waive UM/UIM to lower their premium. On paper it saves money. In practice, it removes the one coverage that protects you when someone else makes a mistake and can't pay for it. Given that Louisiana consistently ranks as one of the most expensive states for car insurance precisely because of its high accident and litigation rates, skipping this coverage is a gamble with bad odds.
Getting a Quote Will Hurt Your Credit Score
It won't. This is the same myth that keeps people from shopping for home insurance, and it's just as wrong on the auto side.
When you get a car insurance quote, the carrier pulls your insurance score, not your credit score. Your insurance score is generated through LexisNexis and uses some of the same financial data as your credit score, but pulling it is a soft inquiry. It has zero effect on your credit. Hard inquiries, the kind that actually matter, come from loan applications, credit card applications, and similar financial products.
This myth costs people money because it stops them from shopping around. Rates in Louisiana vary a lot between carriers for the same driver and same vehicle. In Baton Rouge, Shreveport, and New Orleans, we regularly see differences of $500 to $1,000 or more between the highest and lowest quotes. If you haven't compared rates in a couple of years because you thought it would ding your credit, it won't. There are real ways to save money on car insurance in Louisiana, and comparing quotes is one of the most effective.
What We Tell Our Clients
Most of these myths survive because the insurance industry doesn't do a great job of explaining how things actually work. The language is confusing ("full coverage" being a prime example), the rules vary by state, and people don't think about their auto insurance until something goes wrong.
The best thing you can do is actually read your declarations page. It lists every coverage you have, every limit, and every deductible. If anything on there doesn't make sense, ask your agent to explain it. If they can't or won't, that tells you something.
If you're curious about what goes into Louisiana's auto insurance requirements and how they affect what you pay, check out our breakdown of what every Louisiana driver needs to know. And if you were in a recent accident and aren't sure what to do next, here's our step-by-step guide on what to do after a car accident in Louisiana.
Frequently Asked Questions
What does "full coverage" actually mean in auto insurance?
Full coverage is not an official insurance term. It's informal shorthand for a policy that includes liability, comprehensive, and collision coverage. It does not include uninsured motorist coverage, rental reimbursement, roadside assistance, gap coverage, or other add-ons. What your lender requires is comprehensive and collision coverage on top of your liability, and that's all "full coverage" refers to.
Does the color of my car affect my insurance rate?
No. Insurance companies don't know or care what color your car is. Your rate is based on the vehicle's make, model, year, safety ratings, theft rates, and repair costs. A red Toyota Camry costs the same to insure as a white one.
Is Louisiana's state minimum auto insurance enough?
Louisiana's minimums are 15/30/25, meaning $15,000 per person and $30,000 per accident for bodily injury, and $25,000 for property damage. The average bodily injury claim nationally is over $28,000, which already exceeds the per-person limit. If you cause an accident with serious injuries or hit a newer vehicle, you could owe tens of thousands out of pocket.
Will getting an auto insurance quote hurt my credit score?
No. Insurance companies use a soft inquiry to pull your insurance score through LexisNexis, which is separate from your actual credit score. It has zero impact on your credit. Hard inquiries only come from loan and credit card applications.
Can my car insurance go up after an accident that wasn't my fault?
Yes. In most states, including Louisiana, insurance companies can raise your rate after a not-at-fault accident. A Consumer Federation of America study found an average increase of 9.6% for moderate-income drivers. Only California and Oklahoma prohibit this practice. The rate impact can last three to five years.
Does auto insurance follow the driver or the car in Louisiana?
In Louisiana, auto insurance follows the car first, then the driver as secondary coverage. If you lend your car to a friend and they cause an accident, your policy is the primary policy that responds. Your deductible, your limits, and your claims history are all on the line.
Do I need uninsured motorist coverage in Louisiana?
Louisiana requires uninsured/underinsured motorist coverage by default on every auto policy. The only way to not have it is to reject it in writing. About 11.7% of Louisiana drivers are uninsured and 35.6% are underinsured, so waiving this coverage removes the one protection you have when another driver can't pay for the damage they caused.
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