To illustrate the difference between and Full Coverage , let’s look at two friends, Leo and Sarah, who both drive through the same busy intersection on a rainy Tuesday.
Leo is on his own for his sedan. Since he doesn't have Collision coverage, his insurance won't pay a dime for his totaled car. He has to take the bus to work the next day and start saving from scratch for a new vehicle. 2. Sarah’s Experience (Full Coverage)
Sarah’s situation is messy, but her financial hit is capped. car insurance full coverage vs. liability
Leo’s insurance company steps in, but only for the other person.
drives a newer SUV she’s still financing. Because her bank requires it (and she wants peace of mind), she has Full Coverage , which includes Collision and Comprehensive insurance. The Incident To illustrate the difference between and Full Coverage
If a branch had fallen on her car during the storm instead of a crash, her Comprehensive coverage would have handled it. The Moral of the Story
Because she has Collision coverage, her insurance pays the "Actual Cash Value" of her SUV, minus her deductible. If she has Rental Reimbursement, they also provide a temporary car while she shops for a replacement. He has to take the bus to work
drives an older sedan he paid off years ago. To save money on monthly premiums, he carries Liability-Only insurance—the bare minimum required by law.