This information may be true for some certain financial institutions that lend money for a car to be purchased but in general most lien holders will require the person paying on the loan or lease to keep full coverage of collision and comprehensive plus liability on the vehicle until the entire amount borrowed is completely paid off.

Lenders require the physical damage coverages of collision and comprehensive to be on the vehicle to protect their asset until it is paid off and at that point what was their property is now your property and asset. Once you are the full owner of the vehicle then you lower your limits and coverages to your liking.

If you are paying off a car and want to find out if your lien holder will allow you to drop your insurance from full coverage down to liability only before the loan is totally paid off, you will have to contact your lender directly.

For a reasonable auto insurance quote on either collision and comprehensive or liability only, start here with us.