What is Full Auto Insurance Coverage
Posted by onlineautoinsurance at 7/19/2008 2:38 PM and is filed under auto insurance coverage
being fully protectedWhen you purchase a full coverage package are you really fully covered? The term “full coverage” can be misleading to policyholders since many people believe that they are completely covered under any circumstance. The reality of it is that all coverage does have its limitations even though it may imply being fully covered. It basically consists of a liability coverage packaged together with comprehensive and collision protection for your insured vehicle.
The liability portion of a policy is very specific. Coverage limits are specified in three parts:
1. The maximum amount it will pay out on a “per person basis” for medical injuries caused by the insured;
2. The maximum of medical injury payouts on a “per accident basis”, meaning for multiple persons.
3. The total amount of property damage payouts per accident.
The insured has the ability to change these limits depending on the desired coverage. Many carriers may only offer the minimal coverage limitations; therefore, when choosing companies, make sure they can offer your desired protection. The insurer will only pay the specified amount indicated on the declarations page and agreed to when signing the application.
Choosing a low limit and having insufficient coverage might leave you vulnerable to financial loss. For example, if one were to cause damages exceeding coverage amounts, whatever is not covered by the policy will be left owed by the insured. Always consider higher protection to protect personal assets.The comprehensive and collision portion of full coverage is also a bit misleading. An insurance carrier is obligated to pay only the actual cash value of your vehicle and not what is owed towards the loan. For example, someone who has recently purchased a new car and becomes involved in an accident is not going to receive the full amount of the vehicles purchase price. Carriers pay property damage claims based on the “blue book value” and not the retail value. Learn more about how auto insurance companies determine vehicle value to understand the whole concept. When you purchase a new vehicle and drive it off the car lot your vehicle is automatically depreciated by thousands of dollars.It is important to understand the unknown truth behind full coverage in order to avoid the unexpected. Protection from other losses such as medical payments necessary for your passengers is a coverage that is offered but not automatically included in a full coverage package unless requested. Other coverage may be added to protect you even further such as Uninsured Motorist Protection, Rental Car Reimbursement, Towing and more. Don’t be fooled by the title of a coverage, ask your agent or learn more about coverage definitions to better understand what risks you may be taking.
Protect yourself, your friends and family by making sure you are fully covered in the event of an accident. Let OnlineAutoInsurance.com help you easily compare car insurance quotes online from multiple companies with one simple process and with no obligations whatsoever.
