When buying car insurance, it’s important to understand the factors that can affect your premium rates and coverage. But how can you tell the difference between truth and fiction? A good place to start is by reading the following on the five common myths about auto insurance.

Myth 1: It’s all black and white

During a recent trip to Cape Cod, Mass., my parents and I visited the private sports car collection of Bill Putman at Toad Hall, which was named after J. Thaddeus Toad, Esq., a character in the children’s novel The Wind in the Willows, who loved red cars.

My mother, a vintage car enthusiast, was standing next to a 1958 MGA coupe, and whispered, “He [Putman] must have some insurance bill.”

“Well, probably so,” I said. “After all, they are classics.”

“No, no, no!” she hissed. “Not because they’re old; because they’re all red. Everyone knows red cars cost more to insure!”

Contrary to popular belief, your car insurance rate doesn’t depend on whether your car is cherry red, pickle green (like my first car) or pearl white (the most popular color for 2015, according to Forbes). What does matter is the type of car you buy.

Before you buy a Rolls Royce or a Toyota, check what it’s going to cost to insure. Auto insurance premiums are based on make, model, body type, engine size, the age of the vehicle, as well as the age, driving record, and credit history of the driver. A reckless driver who gets speeding tickets is going to pay more than a careful driver, no matter what color car he’s driving.

Premiums are also based, in part, on the car’s sticker price, the cost to repair it, its overall crash safety rating or record and the likelihood of theft. Many insurers offer discounts for features that reduce the risk of injuries or theft, such as daytime running lights and anti-theft devices. Buying the same car in beige instead of red, however, will not get you a discount.

Myth 2: Your credit score has no bearing on your insurance rates

Your credit score affects every facet of your financial life, from mortgage rates when buying a home to employment, so you probably shouldn’t be surprised to learn that a lower credit score may result in higher auto premiums.

If you have a lower credit score but don’t want to pay more for auto insurance, you may want to look at some of the reasons your credit score may be lower to begin with. One habit to get into is to identify a financial plan relative to your individual situation make a commitment to paying your bills on time, every time.

Myth 3: Your insurance will cover you if your car is stolen, vandalized, or damaged by falling objects, hail, flood, or fire

Usually, the only way to have a stolen car or these types of damage paid for is for your insurance to include comprehensive coverage, which is optional. People driving older cars sometimes drop this optional coverage to save money; in fact, if a car’s market value is worth less than $5,000, depending on your individual financial situation, buying comprehensive coverage may not be cost effective. It is important to consider, however, that you need to buy both collision and comprehensive coverage to fully protect your vehicle from all types of damage.

Myth 4: If other people drive your car, their auto insurance will cover them in the event of an accident

That’s not usually the case, as in most states, the auto insurance policy covering the vehicle is considered the primary insurance. That means that your insurance company usually must pay for damages caused in an accident involving your car, no matter who is driving it. Policies and laws differ by state, so be sure to check with your insurance company about what’s covered when another person drives your car.

Myth 5: Personal auto insurance covers both personal and business use of your car

If you are self-employed and use your vehicle for business purposes, personal auto insurance may not protect you. You should consider checking with your insurer about what is or isn’t covered for business on a personal policy.

Auto insurance for a business may be more costly than a personal policy, although one of the best ways to keep your auto rate down is by having a good driving record. If other people such as employees drive your car, make sure they also have a valid driver’s license and a history of safe driving. Consider checking at least twice a year to ensure they maintain clean driving records.

As Mr. Toad said, “Come along! Hop up here! We’ll go for a jolly ride! The open road! The dusty highway! Come! I’ll show you the world!” (But only as long as he has the proper insurance!)

Loretta L. Worters is vice president of the Insurance Information Institute, whose mission is to improve public understanding of insurance – what it does and how it works. Ms. Worters is an author and woman’s advocate who appears  regularly on TV, radio and in publications. Follow her on twitter at @LWorters.