Is it Worth Having Full Coverage Auto Insurance?

June 13, 2018

If you are like most drivers, you want to find a way to save on your auto insurance. Before you go and give up the full coverage because you think it’s not worth it, you may want to consider a few things. Sometimes keeping more coverage than you need will cost you less in the long run, especially if you have to use your insurance.

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Understanding Full Coverage Auto Insurance

First, let’s look at what full coverage auto insurance is and how it works.

A common policy usually includes liability, collision, and comprehensive insurance. This means you are covered if you cause an accident and damage to someone or someone’s property. You are also covered if anything happens to you or the people inside your car. Finally, you are also covered if something happens to your vehicle while you are not driving it.

The type and amount of each insurance will differ by company and driver. As always, read the fine print of your insurance policy to make sure you know what you are getting.

For example, some policies don’t include uninsured or underinsured coverage in their full coverage option. You may want this coverage, though, as it protects you if you are in an accident with someone that doesn’t have proper insurance or has no insurance at all.

Are You Required to Have Full Coverage?

If you don’t own your car outright, you will have to have full coverage – the lender will require it. This helps protect the lender should you be involved in an accident and your car is a total loss. If that happens and you don’t have proper car insurance, you will still owe the bank the remaining amount left on your car loan. This puts the lender in a bad situation because now you’ll have an outstanding loan and no car to drive.

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Reasons You Might Want Full Coverage

Even if you aren’t required to have full coverage, you still might want it. For example, if you would not be able to afford to replace your car should you be in a car accident, you need more coverage. You want to make sure that every angle possible is covered should you be involved in an accident.

You may also want to keep this coverage if you drive a lot or if you drive an expensive car. If your risk of a car accident is high or you risk not being able to afford to replace your car, keeping the car insurance can be a large benefit.

You cannot predict if you will be in an accident and who will be at fault if you are in one. It’s always better to be safe rather than sorry.

It’s never a good idea to drop full coverage just because you can. Yes, the savings might seem great on a month-to-month basis, but if you get involved in a car accident, you could find yourself in serious trouble. If you cannot afford a car or you owe the bank a large amount of money, it could put you in a serious financial bind. Talk to your insurance agent about the different options available to you. Ask what full coverage entails and if there are ways you can cut costs without sacrificing the coverage. You can also shop around to find the policy with the most affordable premiums, giving you the coverage that you need.

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