Liability, Collision And Comprehensive

What is it? These are the three main types of coverage available in an auto insurance policy. Liability pays other people if youve injured them or damaged their property. Collision pays to repair damage to your car caused by (what else?) collisions. Comprehensive pays you for your losses due to theft and other calamities that are unrelated to collisions -- like damage from hail, fire, vandalism, floods, etc. For full protection, you need all three types of coverage. But if your car is so old that its book value is less than the cost of repairing it, you should consider dropping collision and comprehensive coverage, because no policy pays you more than the cars book value for repairs or replacement.

Added By: Katie

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