Sarah’s situation is messy, but her financial hit is capped.
is "protection for your wallet against others ." It stops you from being sued into bankruptcy for a mistake, but it leaves your own car vulnerable.
is "protection for your asset ." It ensures that no matter who is at fault—or if a "act of God" occurs—you aren't left walking. car insurance full coverage vs. liability
Leo’s insurance company steps in, but only for the other person.
The car in front of them slams on its brakes to avoid a stray dog. Leo, distracted for a split second, rear-ends the car. Sarah, right behind Leo, swerves to avoid him but hydroplanes into a concrete light pole. Both cars are totaled. The Aftermath 1. Leo’s Experience (Liability Only) Sarah’s situation is messy, but her financial hit
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.
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’s insurance company steps in, but only for
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