Full Coverage Compared to Collision Coverage

Contrary to popular belief, a rivalry does not really exist between collision coverage and full coverage. They are two different things, although collision coverage is one part of full coverage. The main thing to remember is that collision coverage by itself is optional, and people can choose not to purchase it at all for an older vehicle that could easily be replaced in the event that it is totaled. On the other hand, someone who is leasing a new car will, most likely, be required to purchase full coverage for the vehicle in order for the bank to recoup its investment if there is an accident.

Collision Coverage

Collision coverage pays for the repairs needed of the policyholder's vehicle, even if the policyholder's actions were determined to be the cause of the accident. collision coverage is optional auto insurance coverage, but it can be mandatory if the car is being leased. The financing company requires that borrowers purchase collision coverage as a way of protecting their investments which are the vehicles they are leasing to people.

With collision coverage, drivers can decide how much of this insurance they would like to purchase. The cost of collision coverage will depend upon several different factors such as how much the car is worth. Collision coverage for a vehicle that is highly expensive will be more costly than for a more economical car, because the higher priced vehicle will cost more money to repair. Therefore, the owner of a pricier vehicle will be charged higher premiums.

Full Coverage

Full coverage includes collision coverage, and it is the entire amount of coverage that finance companies require of the people who are leasing their cars. Therefore, part of full coverage will include everything contained in the above description of collision coverage, but it also includes several other types of coverage.

Everyone is required to purchase the minimum requirements for their state for auto insurance. Unlike collision coverage, the minimum requirements are not optional, and it is called liability coverage. A full coverage policy would cover a state's minimum requirements for bodily injury liability and property damage liability coverage. Motorists can purchase more of this coverage than the state requires them to have if they like, but if they are purchasing only the minimum requirements, everyone is charged the same price.

Liability coverage pays for the expenses of the people hurt in a car collision that the policyholder has caused. It also pays for the property damage in the same accident. It does not pay for the medical bills and property damage of the policyholder who caused the accident. But since full coverage contains collision coverage, policyholders will have the means to have their own vehicles repaired with this section of the policy.

Another part of full coverage is comprehensive coverage. Under the comprehensive portion of the policy, the repairs that are needed on a vehicle not caused by a collision are covered. The cause of the damage may be vandalism due to someone breaking into the vehicle. The car may also be damaged in a storm, and these repairs will be paid for with comprehensive coverage.