Reader’s Question:

My dad just told me that I could have his vehicle. It’s a 10-year-old Civic that is impressively maintained and has an engine that is in proper condition. Since I’m getting this vehicle, the insurance of it will also be passed to me. Currently, the vehicle has a full coverage. Is this necessary? Can I just get a comprehensive vehicle insurance policy for this?

Eric

Naperville, IL

Full coverage is often acquired by those who own vehicles that have high market values. It is used to make sure that the vehicle has full protection from anything that could cause damage to it. Often, it’s applicable to custom-made vehicles or those that are brand-new and high-end.

By saying “full coverage,” I assume that you mean an insurance with comprehensive and collision coverage in it. A comprehensive insurance covers the damages on your vehicle that are caused by defacement, burglary, or glass breakage. On the other hand, collision insurance covers the damages on your vehicle that are brought about by colliding with either another vehicle or other objects.

Before you decide if you should get a full coverage or even just the comprehensive vehicle insurance, you must first know the current market value of your vehicle. Normally, older vehicles are valued low, therefore insurance companies do not advise people to get a full coverage if their vehicles are like these. Companies believe that there is no sense in getting this kind of coverage if they know that you can handle the expense of repairing your vehicle. But if they find out that the repair expense is high, they will advise you to have the repair covered by the vehicle insurance.