The Differences Between Liability and Comprehensive Car Insurance


The main differences between liability insurance and comprehensive car insurance are the insurable and non-insurable losses covered under each policy. Typically, liability policies cover only the negligent act of the insured. However, there are some additional benefits available for policyholders who want to customize their insurance cover. In this article, we will cover the differences between the two types of insurance policies, as well as how they differ in terms of cost. In addition, we'll discuss policy add-ons and how they influence the premium.

Liability policies typically cover only the negligence of the insured

Whether your business involves tangible products or services, liability insurance is essential. A claim for a liability-related injury or damage is usually made against you when you are negligent in some way. In most cases, liability insurance covers this liability, but it does not cover intentional acts or contractual liabilities. However, your insurance carrier has a duty to defend you in such cases. Consequently, your policy will likely cover the expenses associated with defending yourself in court.

Policy add-ons

If you're in the market for new car insurance, there are several policy add-ons available to you. One of the most useful is accident forgiveness. After all, auto-insurance rates skyrocket when a driver is found at fault. However, accident forgiveness does not affect the policy premium if the driver has had a clean driving record for several years. Moreover, accident forgiveness is a one-time only add-on. Roadside assistance is another useful policy add-on, as it provides services such as tire replacement, fuel delivery, towing, and more.

Government involvement in insurance

The question of government involvement in insurance markets is one that is on the minds of many Americans today. While state insurance departments have traditionally regulated insurance markets and insurers, overseeing the financial health of each, rate regulation, and consumer protection, their roles are increasingly expanding. Today, state governments have been called upon to perform the roles of insurers and reinsurers. But are these activities beneficial for consumers? What are the ramifications?