When you hear different terms relating to car insurance, do you often have questions? A lot of people find auto insurance confusing, and one question some people have involves full-coverage insurance. Do you know what full-coverage insurance really is and why you should have it? Here are some key details about it to help you understand what it is.
The Coverage It Includes
The term "full coverage" is not really a term you would see on your insurance documents. Instead, it is a term used to describe adding several types of coverage to your policy so that you and your vehicle are fully protected from just about any event. There are three main types of coverages a full-coverage policy would include:
- Collision – Having this coverage provides compensation to you anytime you cause an accident. Your insurance company would pay for the damages to your car if you have this coverage.
- Comprehensive – Having this type of coverage fills in the gaps for coverage on your car where collision coverage lacks. If you hit a deer or experience vandalism, this is the coverage that provides you with compensation for the damages.
- Liability – This is what you need for any damages you cause to other cars or people.
As you can see, having these three forms of coverage will protect you from just about any event you might experience.
The Purpose of It and Why You Need It
Having a policy that protects you in this way is important if you own a car that is valuable or that you have a loan on. The coverage would pay off your loan if you cause an accident or compensate you for damages that your car incurs. If you total your car, it would also provide coverage for that. Having a full-coverage policy is important for the protection of your own vehicle.
Times When You Might Not Need It
There are times when you might not need this much coverage, and the most common time is if you own a car that is old and not worth a lot of money. In this case, it would not make a lot of sense to buy all this coverage for the car because the car is not worth much.
As you evaluate the information presented here, you should know whether you need full-coverage insurance or not. To learn more, contact an insurance agency of your choice.
To learn more, contact a resource like the Nelson Insurance Agency.