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Insurance 101: Auto Insurance Liability Coverage

By January 8, 2020January 26th, 2022Insurance 101
Insurance 101: Auto Insurance Liability Coverage

When looking for auto insurance quotes, it is important to determine the type of coverage that you need. We often hear people refer to “liability insurance,” versus “full coverage insurance,” but what does that mean, exactly? These terms are standard vernacular when discussing auto insurance, but if you don’t know what they mean, they can be misleading.

When someone refers to “liability only coverage”, it simply means that the insurance policy will only cover the bodily injury and property damage of others in the event that you cause an accident where someone is injured or the other party’s property is damaged. For example, if you cause an accident and someone in the other vehicle is injured, and their car sustains damage from the impact, your insurance company will pay up to your limits of coverage to cover the expenses that the person incurs as a result of you causing the accident. However, it does not cover the damage to your own vehicle. Changing from “liability insurance” to “full coverage insurance” is accomplished by adding Comprehensive and Collision coverage to your policy, which would extend coverage to your vehicle. In this case, you would pay the applicable deductible, and then the insurance company will pay the remainder that it costs to repair your vehicle, or replace your vehicle at actual cash value in the event of a total loss.

For more information about auto insurance coverages, check out Insurance 101: Auto Insurance Coverages.

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