Research On Car Insurance

By Researchopia

Car Insurance: Liability Vs Full Coverage

No one likes to purchase car insurance. It is an unwanted, but unfortunately necessary, added expense. To top this off, insurance companies use very specific terms and awkward wording, making their policies hard to understand and follow. It is basically kind of like reading Latin, backwards. Let us be honest, all most of us care about is finding the best car insurance or the cheapest car insurance.

Still, even though it can be a pain, it is very important to familiarize yourself with specific insurance terms and procedures. This will help to ensure that you find car insurance that is best suited for your individual situation. For instance understanding the difference between Liability and Full Coverage car insurance can save hundreds, and probably even thousands of dollars.

Liability
Every state has a different set of guidelines and regulations for car insurance, requiring drivers to carry a minimum amount of insurance coverage. This minimum amount of insurance is known as liability insurance. Liability insurance is the amount of insurance you are required to have, in order to legally drive within you home state. Basically, Liability insurance will cover damage that you do, when you are cited or at fault, to another person or another person’s property.

Here is where liability insurance gets tricky. There is no actual guarantee that it will cover all the damage you do to another person or their property. For instance, if you policy has a max limit of $15,000 for property damage, and you cause 50,000 of property damage. You will personally be held responsible for the remaining amount.

Full Coverage
Full coverage is basically three different types of coverage. First, it provides all the protection of liability car insurance. On top of this is comprehensive coverage and collision coverage.
• Collision coverage is like the name sounds. It covers damage done to your car when you encounter a car accident
• Comprehensive coverage covers everything else. Like theft, fire, weather, acts of God, etc.
If you have a car loan, most of the time full coverage is required. However, on cars where the title is not owned by a lender, it is sometimes possible (depending on the state) to just carry comprehensive coverage. This option provides more protection than liability, but is less expensive than full coverage.