Full coverage auto insurance is a term that is commonly used to describe a comprehensive auto insurance policy.
Full coverage auto insurance typically includes liability coverage, collision coverage, and comprehensive coverage, as well as additional options such as uninsured/underinsured motorist coverage and medical payments coverage.
In this blog post, we’ll take a closer look at what full coverage auto insurance is, what it covers, and how to choose the right policy for your needs.
Full coverage car insurance policies can vary in both structure and availability, but generally, policies include:
1. Liability Coverage
Liability coverage is a type of auto insurance that provides protection if you’re involved in an accident and it’s determined to be your fault. Liability coverage typically includes two types of coverage: bodily injury liability and property damage liability.
- Bodily injury liability: Bodily injury liability coverage provides protection if you’re involved in an accident and someone else is injured. This coverage will pay for the other person’s medical expenses, as well as any legal costs if they decide to sue you.
- Property damage liability: Property damage liability coverage provides protection if you’re involved in an accident and damage someone else’s property. This could include damage to another vehicle, a fence, or a building. This coverage will pay for the repair or replacement of the damaged property.
Liability coverage is typically required by law in most states, and it’s important to have enough coverage to protect yourself in the event of an accident. The amount of liability coverage you need will depend on your state’s minimum requirements, as well as your personal situation and assets.
2. Collision Coverage
Collision coverage is a type of auto insurance that provides protection if you’re involved in an accident and your vehicle is damaged. This coverage will pay for the repair or replacement of your vehicle, regardless of who was at fault for the accident.
Collision coverage is optional, and it’s typically only recommended if you have a newer or more expensive vehicle. If you have an older or less valuable vehicle, the cost of collision coverage may not be worth the potential benefits.
3. Comprehensive Coverage
Comprehensive coverage is a type of auto insurance that provides protection for damages to your vehicle that is not caused by a collision. This could include damages from events such as theft, vandalism, fire, or natural disasters.
Comprehensive coverage is optional, but it can provide valuable protection for your vehicle. If you have a newer or more expensive vehicle, comprehensive coverage can help protect your investment in case of non-collision damages.
4. Uninsured/Underinsured Motorist Coverage
Uninsured/underinsured motorist coverage is a type of auto insurance that provides protection if you’re involved in an accident with a driver who doesn’t have insurance or doesn’t have enough insurance to cover your damages. This coverage will pay for your damages and medical expenses, up to the limits of your policy.
Uninsured/underinsured motorist coverage is optional, but it can provide valuable protection in case you’re involved in an accident with an uninsured or underinsured driver. This coverage is typically recommended if you live in an area with a high rate of uninsured drivers.
5. Medical Payments Coverage
Medical payments coverage is a type of auto insurance that provides protection for medical expenses if you or your passengers are injured in an accident. This coverage will pay for medical expenses, such as hospital bills, medical treatments, and rehabilitation, up to the limits of your policy.
Medical payment coverage is optional, but it can provide valuable protection if you or your passengers are injured in an accident. This coverage is typically recommended if you don’t have health insurance or if your health insurance doesn’t cover injuries from car accidents.
You could require a full coverage policy if you financed your car and still owe money on the loan. If you lease your car, a full coverage policy can also be necessary. Because until you pay off your loan or your lease arrangement expires, your lender or lessor technically owns your automobile. They, therefore, have a financial stake in your car, and full coverage insurance guarantees payment in the event of damage to the vehicle before a loan is repaid or when you return it at the end of a lease.
If you pay for your car every month, carefully review the contract to determine whether you are obliged to carry full coverage and, if so, how much you require.
Full coverage auto insurance is optional in addition to that. Full coverage is something you should talk to your insurance provider about if being at fault in a car accident will unquestionably ruin your family’s finances. If your automobile is old, paid off, and not worth much, however, and you have good liability coverage, you may probably omit collision and comprehensive coverage because the added cost of your insurance may eventually outweigh the cost of repairs or replacement.
Does Full Coverage Make Sense?
In the case of a significant collision, catastrophe, or incident, a full-coverage vehicle insurance policy should guarantee that you have enough coverage to safeguard all of your valuables. As with any financial choice, full coverage insurance has advantages and disadvantages.
- can aid in meeting state, lender, or lessor demands
- can shield you if the at-fault driver’s insurance is invalid
- may pay for losses not caused by accidents, such as theft, and vandalism.
- If you are wounded in an accident, it can pay for your medical expenditures.
- is more costly than standard liability insurance.
- Will not protect your vehicle from normal wear and tear
- does not offer protection if you use your car for business purposes.
Full Coverage Insurance and Deductibles
You must choose deductibles and limitations when you buy a full-coveragefull-coverage auto insurance policy. The amount you must pay out of pocket before your insurer will cover any further costs is referred to as a deductible. Depending on the kind of claim you submit, your deductible may apply at different times.
A deductible is not included with liability auto insurance. If you are held accountable for an accident, your insurance company will pay the costs up to the amount of your liability limit. For instance, if your limit is $25,000 and an accident caused $15,000 in property damage, your insurer will pay the expenses. However, if the total cost of the losses was $27,000, your insurance company will only pay up to the amount of your policy maximum; the remaining $2,000 will be your responsibility.
Both the comprehensive and collision insurance policies include deductibles. You must therefore reach your deductible before your insurer will cover the remaining costs if your claim is covered by either of those policies. For instance, you would pay $500 and your insurance company would pay $3,500 if a tree fell on your car and caused $4,000 in damage.
full coverage auto insurance is a comprehensive policy that includes liability, collision, and comprehensive coverage, as well as optional coverage such as uninsured/underinsured motorist coverage and medical payments coverage. The right full coverage auto insurance policy for you will depend on your personal situation, your vehicle, and your state’s insurance requirements. Be sure to research your options and compare quotes from multiple insurers to find the right policy at the best possible price.