Knowledge is power. Money is power. The more you know about your insurance policies, the more likely you are to save money, and the more power you are likely to have over your life. A car is so essential to most people that it has become a basic need. Be that as it may, owning a car and ensuring that it serves you for as long as you need it is not a cheap thing. That’s why insurance companies make most of their income from auto insurance. Knowing the details of the insurance you sign up for is crucial because it enables you to determine what you need and what you don’t. Let’s discourse liability insurance vs. full coverage insurance and see why and when you may need either.
Liability insurance essentially covers any damage done to other vehicles by your vehicle, in the event of an accident. That means that in the event you are involved in an accident, your insurance company will take care of the other guy’s car, while you’ll have to sort yourself out. This is ideal when you are low on cash because even before we get to details about it, full coverage insurance is expensive.
There is a reason why insurance companies offer these two distinct insurances for vehicles. There are various circumstances and situations where one kind of insurance may be preferred over the other. If you are using an old vehicle with perhaps a few years to live, it wouldn’t be wise to get full-coverage insurance for it. I mean, you may end up paying insurance that’s more expensive than what the car is worth. It has already been mentioned but it doesn’t hurt to reiterate; when you are having financial challenges, even if your car is in a good shape, it may make more sense taking a liability insurance instead of full coverage. You may also prefer liability insurance when you intend to save money for other purposes, including taking care of any damages that your car may experience. There are times when saving money makes more sense than paying extra dollars for insurance that at the moment you don’t really need. These are just a few suggestions on situations where you may not need full coverage. Liability insurance is, therefore, more economical depending on the situation and the vehicle in question. However, full coverage has its advantages.
Full Coverage Insurance
Full coverage insurance takes care of all and any damages done in an accident that your vehicle was involved in. That means if your car was damaged, it’ll be taken care of, and if the other guy’s vehicle was damaged too, it’ll also be taken care of. Also, any other property/s that’s damaged as a result of an accident involving your vehicle will also be taken care of. Since so much is covered under the full coverage insurance, it is natural that it’ll be more expensive compared to liability insurance.
If your vehicle is old, or for some other reason you deem it not worthy of paying too much insurance for, then the liability insurance will be ideal. But if your vehicle is something special; a new vehicle, rare model, classic/ vintage, a respected brand, among others, then getting the full coverage insurance will make more sense. Ever noticed how most people will be careful not to be responsible for an accident involving a vehicle that’s way more expensive than their own? Yeah, you too will also be careful not to be responsible for an accident when your car is special; expensive. Nonetheless, you cannot be too careful. Something may happen at some point, and you’ll have no control over it. In such a situation, a full-coverage insurance will be your best friend because it means your sweet and special vehicle will be compensated. If the converse is true, and if you are a crybaby, then you’ll need a lot of boxes of tissue.
Liability vs full coverage insurance is an auto insurance war that has been around for a while now. Only when you understand the full benefit of either will you be able to appreciate their significance. Do some homework and determine what offers are being made out there by the various insurance companies, compare your notes with other interested parties if possible, and ultimately, make an informed decision regarding the insurance that works for you.