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Do You Really Need Full-Coverage Car Insurance?

When the time comes for you to go shopping for car insurance, you might be wondering if you really need to spend the money on a full-coverage car insurance policy. While you may have to buy a full-coverage policy, there is also a chance you do not need to. Here are several of the factors that will affect the choice you make in this purchase.

Your loan status

Do you owe money on the car to a car lender? If you do, there is no way around needing full-coverage insurance. Your lender will tell you that this is a requirement, and it is primarily required to reduce the risks for your lender. It is also required to reduce your risks, too. If you totaled a new car you owed a lot of money on, you would have to pay the rest of the loan out of your pocket if you did not have full-coverage insurance. If you had full-coverage, your insurance company would pay the costs.

Your driving habits

How much do you drive? This is a second factor to consider as you choose full-coverage or alternative options. If you do not have a loan, and you barely drive the car, your risks of totaling it might be very low, which means you really would not need full coverage. On the other hand, if you have a long commute to work each day and put a lot of miles on your vehicle, you probably have a higher risk of getting in an accident. In this case, having full-coverage would be a great idea.

The value of the car

Another factor to examine is how much your car is worth. If you do not owe money on it, and if it is not worth a large amount of money, having full-coverage might not make sense. On the other hand, if the car is valuable, even if you do not have a loan, having full-coverage makes a lot of sense.

The risks to your car

The last factor to consider is the risks you have with your car. Do you park it outside? Are you at high risk for colliding with a deer? If you answered yes to any of these questions, choosing full-coverage is a great idea.

If you are interested in learning more about the options you have with car insurance, contact an auto insurance company like Nelson Insurance Agency for more information.