Liability vs. Full Coverage Insurance: What’s The Difference?
When it comes to finding a decent insurance policy for your car, there are so many options when picking the best insurance package for your individual situation.
Our agency receives hundreds of calls from shoppers in search of car insurance, each with their own unique needs and situations. But, the most common question we receive daily is:
To answer this frequently asked question and clear up any confusion, this article will break down both liability and full coverage insurance policies, give you a general overview, and show you what each type of car insurance policy covers.
Liability and Full Coverage Chart
The below chart shows some coverage found on a standard liability insurance policy versus the coverage found on traditional full coverage car insurance policies.
|Bodily Injury Liability||Standard||Standard|
|Property Damage Liability||Standard||Standard|
|Uninsured Motorist Bodily Injury||Standard||Standard|
|Uninsured Motorist Property Damage||Optional||Not Avail|
|Rental Vehicle||Not Avail||Optional|
It is important to note that the liability coverage selected shows the most minimum coverage options as required by law in most states.
Medical payments and uninsured motorist property damage coverage is typically included in a liability insurance policy and requires a signed rejection to opt out.
Liability insurance coverage is the foundation to every car insurance policy. This coverage provides you, the policyholder, with financial protection in the case you, or a covered driver, is found liable for someone else’s medical bills or property repairs.
This type of insurance policy contains a particular set of coverage all drivers need to protect themselves from lawsuits as a result of damages they’re liable for. These coverages include:
- Bodily Injury Liability
- Property Damage Liability
- Uninsured Motorist Bodily Injury
- Underinsured Motorist Bodily Injury (in some states)
Liability insurance is a requirement almost every state in the nation. Typically, states set a mandatory minimum liability amount, usually at a split limit (i.e. 25/50, 30/60.)
Full Coverage Insurance
Full coverage insurance is the addition of comprehensive and collision coverage to any liability car insurance policy. Adding these optional coverages makes you “fully covered.”
If you own a vehicle that’s still worth a significant amount of money, it is recommended that you opt in for full coverage. Since the vehicle still has plenty of value remaining it, it should be fully insured.
Unlike liability insurance, full coverage is not mandatory by any state or authority. But if you have an auto loan or lease, your lender will require you to obtain full coverage insurance.
What Does Full Coverage Insurance Consist Of?
Full coverage insurance is the addition of comprehensive and collision coverage to any liability car insurance policy. These two coverages, sometimes called physical damage, add an additional layer of protection to a standard liability insurance policy.
Comprehensive insurance is an optional car insurance coverage that protects your car from damage that results from anything but collision or vehicle rollover.
Comprehensive insurance coverage provides protection from damage caused by a number of losses, including:
- Fire or Explosion
- Hail, flood, hurricanes or tornadoes
- Animal damage
Collision insurance coverage is one of the main coverage found on a full coverage insurance policy. Collision helps to replace or repair your vehicle if it’s damaged in an accident with another vehicle or property, such as a building or fence.
Unlike liability insurance, which helps pay for damage to the other driver’s vehicle if you cause an auto accident, collision insurance can cover damage to your own vehicle — regardless of who is at fault.
Liability vs. Full Coverage
Before you sign on the dotted lines for your new car insurance policy, it’s crucial to understand the types of car insurance coverage to determine exactly what you need.
It’s always a good idea to speak to your car insurance agent to help determine whether liability or full coverage is right for you.
When helping a driver decide on whether they need liability or full coverage insurance, we typically ask a few questions before we offer our recommendation. You probably need full coverage insurance if one or more of the following apply to you:
- Your car is financed or leased.
- Your car is 7 years old or newer.
- Your vehicle is worth a significant amount of money.
- You drive a lot.
- You live in an area that experiences extreme weather conditions.
- You own your car outright, but can’t afford to replace it or repair serious damages.
Insured ASAP Insurance Agency provides affordable quotes on liability and full coverage insurance. Contact us today with any questions you may have regarding liability or full coverage insurance. Car insurance quotes are available online or by phone or text.
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Bridgeview, IL 60455
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