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Should I Carry Liability Only Coverage or “Full Coverage” On My Auto Policy?

By September 6, 2023Insurance

What Does Liability Only Mean?

It means, that the insurance policy will do the following things:

  • Defend you from a liability suit up to the policy limits,
  • Repair property damage done to others caused by you,
  • Pay for bodily injury caused to others by you, up to the policy limits;

What your liability coverage will not do is:

  • Repair your vehicle in the event of an at fault accident,
  • Provide you any payment to repair your vehicle;

Liability-only insurance protects you when you do damage to someone else. The focus is on the person you hit, not you.

What Does “Full Coverage” Mean?

(Quick note. “Full Coverage” is not an insurance term. There is no “full coverage” button to push. I will continue to use the term because it is common terminology; but know there is no such thing as “full coverage.”)

It means the insurance agent adds two more coverages to your policy: Comprehensive and Collision.

Comprehensive coverage pays for:

  • Hail damage,
  • Theft,
  • Deer hits,
  • Damage by fire (Ex: your garage burns down with the car in it);

Collision coverage pays for:

  • Repairing the damage to your car, no matter whose fault it is;

Example of how the coverages work together:

If we take that same accident that we talked about above, where you were at fault, the liability coverage takes care of the other guy. Comprehensive and collision insurance takes care of your vehicle. This is the simplest definition of “full coverage” I can provide.

Quick summary

  • Liability Only defends you against a suit from others for damages that you caused,
  • Liability Only pays for bodily injury to the other party you injured,
  • “Full Coverage” will do everything that Liability Only does; while including Comprehensive and Collision coverage to help you fix your car;

How Do I Know If I Should Carry “Full Coverage” Or Liability Only?

Consider Liability Only if:

  • Your vehicle has pre-existing damage,
  • Your vehicle is older than eight to 10 years,
  • Your vehicle has high mileage,
  • If you’ve got a youthful driver driving,
  • If you’re not relying on a check from the insurance company if there’s a total loss,
  • If you own your own auto body shop;

Consider “Full Coverage” if:

  • You own a newer model car with lower mileage,
  • You desire the help of the insurance company to fix your vehicle, if there was damage caused in an accident,
  • You need a payment from the insurance company as a down payment in the event of a total loss,
  • You have a lien on your vehicle;

Other Factors To Consider

There’s going to come a time when the value of your car will be low enough that it may not make sense to pay higher premiums for “Full Coverage.” There is a free tool that you can access called the Kelley Blue Book. Please watch the embedded video for more info on how to use this tool.

Thank you!

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I hope everybody’s doing well. Thank you for your time, your business, and your friendship.

Brian Gleize, Account Executive.

Scott Agency

604 E Veterans Mem Pkwy, Warrenton MO 63383