Understanding Insurance Terminology

Understanding Insurance Terminology

What Does Full-Coverage Auto Insurance Cover?

by Vilma Maki

When you own a car that you drive, you will need to have auto insurance on it. If you do not purchase auto insurance, you take many risks when you get behind the wheel. When buying a policy, you can choose what coverages it includes. Many people choose full-coverage insurance policies, but some choose liability-only coverage. If you choose full-coverage insurance, what does it cover? Here is a list of some of the things it will cover.

Damage to Your Car and Other Cars If You Cause a Collision

The first thing a full-coverage policy provides is compensation for your vehicle if you cause an accident. When you collide with another vehicle due to negligence or anything else, your policy provides two forms of compensation. First, it pays for the repairs that your car needs through the collision coverage of the plan. Secondly, it pays for the repairs other cars need through the liability coverage included with the policy.

Damage to Your Car from Other Causes

A full-coverage policy also provides compensation to you if your car gets damaged from other causes. For example, if someone breaks into your car, your policy covers it. If a tree lands on your car, your policy also covers the damages from this event. The comprehensive insurance with your plan provides compensation for these types of events.

Damage to Your Car from Accidents You Did Not Cause

You should also realize that a full-coverage policy includes uninsured and underinsured motorist coverages. The purpose of these coverage types is to provide compensation to you if an uninsured or underinsured driver causes a collision with your vehicle. If the at-fault driver does not have insurance protection, your policy kicks in and pays the damages.

Medical Payments

A full-coverage policy includes a lot of other forms of protection, too. One of these is medical payment coverage. If you get hurt in an accident that you cause, your plan will pay for your medical bills. Most policies have a maximum amount they cover, but it is usually enough to pay for all the medical care you might need. This part of your policy also pays the medical bills for passengers in your car or for other drivers that were injured from an accident you caused.

These are some of the primary things a full-coverage policy protects you from when you purchase this type of plan. If you have questions, talk to an insurance agent today.


About Me

Understanding Insurance Terminology

After we purchased our first home, we realized that it might be a good idea to evaluate our insurance coverage. Although we had purchased homeowners insurance before, we had never owned a policy as large as the one we would need for our new place. Also, our new home had a trampoline and a swimming pool, which made us worried about liability. To iron out the details, I decided to meet with our insurance agent. We talked about things like monthly premiums, coverage limits, and deductibles, and it was incredible to learn more about the terminology. This blog is designed to help you with the same types of questions.