When you buy a used car you have a choice to make. Should you purchase full coverage insurance or just liability? Before you can answer this questions let’s review what each coverage means.
Full Coverage Insurance
Full coverage insurance means you have coverage for your vehicle. The 2 main components to full coverage insurance are comprehensive and collision. Comprehensive covers your vehicle for fire, theft, vandalism, acts of nature and glass breakage. Comprehensive insurance does not cover your car if it breaks down or needs maintenance. Collision coverage covers your vehicle if you are involved in an accident, regardless of who’s “at fault”. If your car is financed or leased, you don’t have a choice. Your lender will require full coverage and they will need to be added as “loss payee” on your policy until the car is paid in full.
In Virginia, and many other states, you are required to maintain liability insurance. Virginia requires all drivers to maintain liability coverage for at least $25,000 per person / $50,000 per accident and $20,000 property damage. If you are “at fault” in an accident, liability insurance will pay for bodily injury and property damage for the other party. Liability insurance does not pay to fix your car.
Selecting the Right Car Insurance Coverage
If you own an older vehicle and the value of the vehicle falls below $2,500, it may not make sense to purchase full coverage. If you are involved in an accident, chances are the insurance company is going to total the vehicle and write you a check for the blue book value. (Kbb.com and Edmunds.com are good resources to use to determine the blue book value of your vehicle.)
If you own a new car or your car is worth more than $2,500, it makes sense to purchase full coverage.
Contact The Andrew Agency
The Andrew Agency works with several insurance companies, some of which specialize in liability only insurance. If you live in Virginia, Maryland or South Carolina and would like a quote on car insurance, home insurance or any other type of insurance contact The Andrew Agency at (804) 320-2886.