subject: California Full Coverage Auto Insurance [print this page] California Full Coverage Auto Insurance
In California many drivers on the road are under the impression that they have a full coverage insurance policy. This is not the case. There is no such thing as full coverage. All insurance policies that are sold in the state will have limits of coverage on them. When involved in an accident the insurance company will only pay up to the limits that were on the policy at the time of the loss. The insured will not be fully covered regardless of the amount of damages that are caused.
In the past many times customers will ask for a full coverage insurance quote. Generally, they are referring to having coverage so that if the vehicle is stolen or is involved in an accident the insurance company will repair it or replace it. The appropriate term for this coverage is physical damage protection. This means that the policy has comprehensive and collision coverage.
For policies that have physical damage coverage the insurance company will pay for repair or replacement of the vehicle up to the actual cash value of the vehicle unless otherwise stated on the policy. Many times consumers are in a position that they owe more on their vehicle than the actual cash value. This is normally during the first few years of an auto loan. This excess amount owed on the vehicle is commonly referred to as the "Gap". There are policies that can be purchased that will insure the consumer for the amount of the loan that exceeds the actual cash value of the vehicle.
When getting insurance quotes it is important that consumers review the limits that are on the policy. California state minimum limits are amongst the lowest in the nation and consumers should request quotes for many limits of coverage. In the event of an accident the insurance company will only pay out to the maximum limit of coverage selected.
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