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What is full coverage and what all does it cover?

Maintaining vehicle insurance is one of the side effects to owning and operating a car. However, it is a necessary one. Currently, forty-seven states in the country require you to maintain at least a minimum liability policy on your vehicle. If you are caught driving without insurance, the consequences can be dire. You will be subject to the penalties of the state you are in. These penalties can range from a fine to the revoking of your driver's license. If you are involved in an automobile accident without the proper amount of coverage, you are opening yourself up to the possibility of being the target of years of costly legal action. The possible negative consequences you can entail from such acts are not worth trying to save a few dollars by skipping out on your insurance. 

When they hear the term "full coverage", most people think of a policy that includes liability and collision insurance. However, full coverage, in the true sense of the phrase, refers to a policy that will meet a state's guidelines for insurance and will provide protection for any property damage a motorist's vehicle may incur. As stated above, the legal requirements for insurance vary amongst the different states. However, most do require you to maintain a minimum form of liability coverage. Liability insurance provides coverage to you in the event that you are found to at fault in an accident. It will cover the costs associated with the other party's medical expenses and the cost of their property damage repairs. The amount that an insurance company will pay towards such costs will not exceed the amounts stated on your policy. If you are involved in an accident where the costs exceed what your insurance company is willing to pay, you will be held liable for the remainder of the balance. It is important to take your location, driving habits, and other factors into consideration when you are deciding what monetary amounts of coverage to purchase. 

Comprehensive insurance can be added to a policy as a supplement to collision insurance. This form of coverage will provide for a motorist if their vehicle incurs damage from an "act of nature" or a crime. These crimes can include vandalism, hit and run accidents, or collisions with animals. Occasionally, a vehicle will be damaged to the point that an insurance company will decide to "total" the vehicle. This generally happens when the costs of repairs exceeds the current market value of the vehicle. In a situation such as this, the insurance company will only reimburse you for the current value of your vehicle. If you have an outstanding balance on the car, you are responsible for paying the deficient. Due to this possible scenario, many motorists who purchase a new car will opt to purchase GAP insurance. GAP insurance, in the event of your vehicle being totaled, will pay the remaining balance owed on the car. Determining your needs is going to be the first step in understanding what "full coverage" will be defined as for you. 


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