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How to Choose Full Coverage Auto Insurance

Updated on March 12, 2012
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Full coverage auto insurance is the most comprehensive insurance plan an individual can obtain. This type of auto insurance policy will cover your vehicle if it is involved in any type of accident. In addition, full coverage policies will cover the costs of repairing or replacing your vehicle if it is stolen, vandalized, damaged by natural disasters, or comes in contact with another object.

What Full Coverage Auto Insurance Does Not Cover

When most people think of full coverage they think that every type of coverage is included in this policy. However, this is not the case. Most full coverage auto insurance policies do not include body injury coverage or property damage coverage.

Body injury coverage pays for any injuries that are incurred as a result of a vehicular accident that involves your vehicle. This is important coverage to have in place, as the cost of medical care can be extensive, even for minor services.

Property damage coverage will cover the cost of repairing any property that is damaged as a result of your vehicle. For example, if you drive into someone’s yard and knock down their fence, property damage coverage will pay to have the fence replaced.

How Full Coverage Auto Insurance Works

When you purchase a full coverage policy, there will be several choices to make. The first choice will be the length of your policy; this can be on a month-to-month basis, in three or 6-month increments, or yearly. Most insurance companies will offer discounts to those individuals that take out longer policies. Next, it is time to set up a payment plan for your policy. Most insurance companies will allow your premiums to be divided into monthly, quarterly, or bi-yearly payments.

In a perfect world, you will not ever have to make a claim on your car insurance policy. However, if something does happen to your vehicle you will need to contact your insurance company immediately. If you are involved in an accident, it is important to contact the local policy department and file a report. The information in this report will be used by your insurance company when you make your claim.

Reporting a claim to your insurance company can take some time as the agent will ask you many questions about the incident you were involved in. After you have reported the claim, the insurance company will begin processing it. Once the claim has been made, you will want to seek out repair for your vehicle. Make sure that you choose a service provider that is approved by your insurance company. Most repair shops will work with your insurance company in order to arrange a payment, saving you from unnecessary out of pocket costs.

Why Should I Get a Full Coverage Car Insurance Policy?

If you currently have a loan out on your car, it is necessary to have a full coverage policy in place, as it is likely your lender will require it. Lenders require full coverage policies for vehicles because this is the best way to protect their investment. If your car is totaled, you will need to have enough coverage to pay off the loan. If you do not have enough money in your savings to replace your car, a full coverage car insurance policy will be necessary. In addition, if you do not have enough money in your savings to cover even minor damages, full coverage policies are your best option.

Costs of Full Coverage Policies

The cost of a full coverage insurance policy will depend directly on the person obtaining the policy. Your driving record, age, sex, and the type of vehicle that you drive will determine how much your premium will cost. Full coverage policies are typically the most expensive type of car insurance. However, there are ways to lower the costs. One way to lower your premium is to raise your deductible. It is important to not have a deductible that is out of reach of your budget, but the higher your deductible is, the lower your premiums will be. Repairing your credit score and driving record are also ways to lower the rate of your car insurance. Clean driving records and good credit histories will afford you the lowest car insurance policies on the market.

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