What type of coverage would typically involve lower out-of-pocket limits?

Comprehensive auto insurance typically involves lower out-of-pocket limits because it provides extensive coverage for various types of damage to your vehicle, as well as theft and liability in the event of an accident. When you have comprehensive coverage, the insurance company generally covers a significant portion of the costs associated with repairs or replacements, which lowers the financial burden placed on the policyholder.

In contrast, high-deductible health plans and catastrophic health insurance usually feature higher out-of-pocket costs and deductibles, exposing the insured individual to greater expenses before the insurance kicks in. Basic liability coverage, while important for meeting legal requirements, covers only damages to others and not the insured's own vehicle, which can also leave the policyholder with higher costs in case of an accident. Therefore, comprehensive auto insurance is designed with a focus on reducing out-of-pocket expenses for the insured in a variety of situations.