Full Coverage Can Be A Misleading Term

Full coverage is not an official insurance term used by the industry.

It does not describe a specific coverage option available to insureds.  Insurance policies are al la carte so simply requesting full coverage does not provide the insured all the options they may need or want.  I like to break down an auto insurance policy into three parts.  Coverage for you, coverage for others, and coverage for your vehicle.

Coverage for you:

This consists or your first party benefits.  The first party being you and your passengers.  First party benefits include medical expense, wage loss, accidental death, and funeral expense.  These coverages are meant to protect you in the event of an accident.  I also include uninsured/underinsured motorist coverage as coverage for you.  This is for bodily injury if the at fault party does not have insurance or enough insurance to cover your injuries.

Coverage for others:

This is your liability.  Liability consists of two coverages, bodily injury and property damage.  If you injure another person or damage their property (ie. vehicle) you are protected up to a certain limit defined on your policy.

Coverage for your vehicle:

Damage to your vehicle is covered through collision and comprehensive and both are subject to a deductible.

Collision coverage will pay to repair/replace your vehicle if you cause damage to it in an accident.

Comprehensive, also called other than collision, will pay to repair/replace your vehicle if damage is cause by but not limited to the following losses: theft/vandalism, falling objects(tree, hail), fire, hitting a deer or wild animal, and all glass claims.  Also included in coverage for your vehicle are towing/labor claims and rental reimbursement coverage.

Having all of these options could be consider “full coverage” but having an understanding of the individual coverage benefits is the best way to approach your insurance policy review.

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