If your car is financed, you need to have full coverage auto insurance, or your bank will buy its own very expensive insurance — and make you pay for it. But are you “fully covered” when you ask for full coverage auto insurance? This blog post will tell you what you need to know about full coverage.
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Does “full coverage” mean the insurance pays for everything if you have a claim — without any deductibles, exclusions, and no dollar limits on coverage — so if you hit LeBron James with your car, and he cannot play pro basketball again, your auto insurance policy will pay the millions of dollars you owe him?
Nope, “full coverage” does not exist. You will never see that wording on your car insurance policy.
Full coverage is a slang term for car insurance coverage to pay for damage to your car, in addition to the auto insurance coverage required by your State’s laws.
So, when you call an agent and ask for a quote for full coverage, expect follow up questions, like what are your deductibles, limits of liability, medical coverage, do you need coverage for the cost of rental car if you have a claim, etc.
A good agent will ask you questions about your coverage. But there are plenty of agents who will quote you “full coverage” without asking you a question. These agents may be quoting you with the lowest liability coverage and the highest deductible to try to get you a lower rate than you have now — but you are not getting a better price, only possibly a lot less coverage.
Beware insurance agents who give you a price without discussing the details of your coverage.
Your auto insurance declarations page lists all your coverage, and will have all the information you need to get accurate price comparisons from other auto insurance companies. You are mailed a new declarations page every time your policy is due for renewal. If you do not have your current auto insurance declarations page, call your agent/insurance company, and they will send it to you.
When shopping for better rates, make sure all insurance companies quote you the same coverage. Click this link to my website explaining auto insurance coverage with shopping tips to help you choose the best coverage for you. See this blog post to decide when to drop full coverage insurance .
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