Do all finance companies require you to get full coverage on a policy?
"Will Carmax require full coverage? Can I just get liability only if I am financing it?"
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Answered on Jul 28, 2021
Emily Maracle is a car insurance specialist living in New York. Originally from the Pacific Northwest, she has a degree in English Literature and a background in customer service. She enjoys cooking, gardening, and living sustainably. In the future, she can't wait to upgrade to a hybrid or electric car.
“Most lenders require that financed vehicles carry both comprehensive insurance and collision insurance. Since the lender technically owns the vehicle while you’re making payments, they want to ensure it will be protected from damage.
Most car companies and dealerships also require that you have a certain amount of car insurance before they’ll release the car. In some cases, this may be the state’s minimum car insurance required or it could be an amount they’ve decided on.
Before you sign an agreement with the finance company or dealership, you should find out what coverage is required. If they only require liability car insurance, you should still consider getting as much coverage as you can afford.
You can never have too much car insurance even if you never have to use it.”
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