Are you planning to buy auto insurance coverage? Do you want full coverage on auto insurance? Then read this post for comprehensive details because you will be surprised when shopping for full coverage. Wondering why? Let’s find out.
What Is Auto Full Coverage Insurance?
To begin with, you will never find the term full coverage on auto policies. In fact, with a quote, you’ll see a comprehensive list of (optional and required) coverage policies available in your state. This is because complete coverage is variable, depending on the state guidelines.
Generally speaking, it combines comprehensive collision and liability coverage. However, in some states, full coverage on auto insurance may require additional policies like uninsured and underinsured motorist coverage and personal injury protection.
Now let's explore more and learn about these policies separately:
Find Cheap Auto InsuranceCollision Insurance
Regardless of who may be at fault for the accident, this policy pays for the replacement and repairs of the car. Furthermore, depending on the coverage provider and their policy, the collision insurance may also pay for the rental car you use until your vehicle is repaired.
The collision insurance pays the vehicle's actual cash value, which is the replacement cost minus the depreciation. Hence, if the vehicle is totalled, you will get the actual cash value of the vehicle as your settlement payment.
Comprehensive Insurance
This insurance type pays for the vehicle replacement or repairs if it is stolen or damaged by the following:
● Animals
● Vandalism
● Hail storm
In other words, it covers you if the damage to your car is caused by something else other than another car. For example, if you run into a tree or stationary object, encounter a golf ball-sized hail, or become a victim of vandalism. Like collision coverage, comprehensive auto insurance covers the car's market value price.
Liability Insurance
Liability insurance is a requirement in most states. Hence, it is included in almost all auto insurance policies. This coverage can be divided into two categories:
● Bodily injury liability
● Property damage liability
As the name suggests, the BI liability coverage pays for medical expenses. The policy covers the hospital expenditures of the party injured if you caused the accident. Likewise, the property damage coverage enables you to smoothly pay for the damages caused by you to the victim's car.
All states have a minimum limit for liability coverage, which automobile drivers must purchase. It typically contains three limits:
● The maximum bodily injury payment per person
● The maximum bodily injury payable per collision
● The maximum property damage payable
What Other Types of Coverage Can Be Included In Full Coverage Auto Insurance?
You may include the following policies to your full coverage:
Underinsured Motorist Coverage
This coverage activates when the driver at fault’s insurance is not enough to cover the damages and injuries in full. For example, if the other driver's liability limit is $25,000 and your medical bills are $50,000, your underinsured motorist coverage will bridge the $25,000 gap, ensuring you're paid.
Uninsured Motorist Coverage
This coverage steps in when the driver at fault has no insurance at all. It covers medical bills, lost wages, and other related expenses, providing financial protection and peace of mind. This is particularly important given the significant number of uninsured drivers on the road, ensuring you're safeguarded against unexpected costs from accidents caused by uninsured motorists.
PIP Protection
Personal injury protection doesn't apply to all states. You may include it in your full coverage if required in your state. Nonetheless, PIP works similarly to the medical coverage. This coverage allows you to pay for medical expenses resulting from the covered loss. It covers limited lost income, hospitalization, and death benefits for passengers after the collision.
Moreover, it may also cover and pay for other crucial expenses while you are in the recovery phase. These include lost income and childcare services.
Medical Coverage
Also known as MedPay, it covers bills for injured passengers in the car and the driver up to a certain limit. Furthermore, this coverage also covers health insurance deductibles along with death benefits. It is applicable regardless of who is responsible for the collision.
Gap Insurance
Like the coverage title, this covers the difference between the automobile's market value and the amount owed on the auto loan.
Moreover, many insurers may offer add-ons to policy buyers searching for full auto insurance coverage. So, you can add these too if you like:
● Roadside assistance
● Rental reimbursement
● Personal item coverage
● Diminishing deductible
● New car replacement cost
● Custom equipment and accessories coverage
What Is The Cost of Full Coverage on Auto Insurance?
The cost of full coverage varies depending on how much protection each individual covers and chooses in their policy. Also, here, it is vital to understand that besides the coverage you select, the cost may also include other factors like:
● How often do you sit behind the steering wheel
● The type of vehicle you drive
● Specific auto insurance requirements in the area you reside
● Deductibles selected by you, etc.
How to Find the Right Coverage For Your Car?
Now that we have answered what is auto full coverage insurance, you must prepare yourself for legwork to find the right coverage for your car. This involves assessing your needs, budget, and risk tolerance.
Start by understanding your state's minimum requirements for auto insurance to ensure you're legally covered. Next, consider your vehicle's value and how you use it. If you have a newer or financed car, comprehensive and collision coverage is advisable to protect against damage or theft.
Evaluate additional coverage options like uninsured/underinsured motorist protection, which shields you from costs if an inadequately insured driver hits you. Personal injury protection (PIP) or medical payment coverage can help with medical expenses regardless of fault.
Decide on appropriate coverage limits and deductibles based on your financial situation. Higher limits offer more protection but come with higher premiums, while higher deductibles reduce premiums but increase out-of-pocket costs in claims. Compare quotes to find the right policy with the best balance of coverage and cost. Regularly review and adjust your policy as your circumstances change. For more information about full- coverage on auto insurance or insurance comparison, visit Bind Right.