What Does Full Coverage Auto Insurance Really Mean?

For Garden Grove, CA, drivers, the term “full coverage” often creates confusion. While commonly used, this phrase doesn’t have a universally accepted definition across the entire insurance industry.

Understanding the Full Coverage Myth

What many call full coverage typically refers to a policy that includes liability coverage as well as comprehensive and collision coverage. Liability coverage can help with expenses if you’re responsible for injuries or damage to others, while comprehensive and collision coverages might help pay to repair or replace your vehicle after various incidents.

However, even with these three coverage types, gaps might still exist in your insurance. For example, this combination doesn’t include uninsured motorist coverage, which could help if a driver hits you without insurance.

Coverage Considerations Beyond the Basics

Several factors influence appropriate coverage levels when evaluating your auto insurance needs. The age and value of your vehicle play significant roles; newer or more valuable vehicles might benefit from comprehensive and collision coverage, while such elements may be less essential when insuring older vehicles with lower values.

Your lender or leasing company typically requires comprehensive and collision coverage if you’re financing or leasing your vehicle. However, once your car is paid off, you can decide whether maintaining these coverages makes financial sense based on your vehicle’s current value.

Finding the Right Balance

Rather than asking for full coverage, consider discussing your situation with your insurance representative. They can help identify coverage options that align with your circumstances, potentially including:

• Appropriate liability limits based on your assets
• Deductibles that fit your budget
• Rental car reimbursement

Learn More

Contact New Advantage Insurance Agency in Garden Grove, CA, to discuss auto insurance options that suit your needs. Our team can help you understand coverage choices beyond the “full coverage” label.

This blog is intended for informational and educational use only. It is not exhaustive and should not be construed as legal advice. Please contact your insurance professional for further information.