Most people these days will get to the point where in they would have to ask themselves if they need a full coverage with a hefty price or a limited coverage that comes with cheaper premiums.
The good thing about full coverage insurance is that you do not have to worry anything if you had an accident. Your insurer will shoulder all the expenses from injuries to property damages. Unfortunately, full coverage insurance is not a cheap type of policy and it’s going to cost you a substantial amount of money. On the other hand, a cheap insurance coverage is light on the pocket but may become an enormous bill one day if the policy limits are exhausted even before the payables are settled.
This is not a simple problem, and I would understand if you tell me that you are a bit confused or do not know where to start on your insurance policy. To help you out, we are going to discuss about it in this article.
The different levels of auto insurance
In auto insurance, every policyholder should understand these three basic labels. These are minimum coverage, liability only coverage, and full coverage.
The first thing we will discuss is the minimum coverage. As the name implies, this policy will serve only the most basic coverage that your state requires you to drive legally. In other words, this coverage is severely limited as far as paying your own needs. For example, you had an accident and the police report indicates that you are the at fault driver. If you have the minimum liability coverage, it will only take care of the expenses needed by the other party but not on you.
On the part of liability only coverage, this will take care of the repair expenses of the third party during the accident. This policy also extends to indemnify expenses such as hospitalization and legal. Regrettably, similar to a minimum coverage, this policy will not pay for your repair or replacement needs.
The last one is the full coverage insurance, which will protect you from accidents and will shoulder all the expenses that you need for medical or repair costs. If you loaned your car or made some other types of loans, you will be required by your lenders to purchase full coverage insurance to protect the car until such time that the car is already paid off.
Insurance for young drivers: why it is so expensive?
You may or may not know that premiums are based on several factors, which is the reason why even twins will have different insurance rates. For instance, some of these factors are age, gender, driving history, etc.
The fact that teen drivers are considered as high-risk drivers, this would explain their surging premium rates. According to the statistics, more and more teen drivers are involved in road mishaps or perform risky driving manners. In addition to that, insurers usually charge the male teen drivers with far more expensive insurance rates than the females.
So what type of insurance policy are you going to buy?
Personally, buying full coverage auto insurance is highly encouraged if you just purchased a new vehicle. Also if you have acquired your vehicle through an auto loan, most lenders will require you to do the same. If you pay for your car outright, it is up to you if you think that you can afford to pay for your own repair needs. Keep in mind that liability only coverage, will only take care of the other expenses needed by the other party, especially if you are the at fault driver. In any case, you should always choose higher coverage for a peaceful mind.
