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What Is Full Coverage Insurance, Who Needs It and How Much Does It Cost?

Man looking at car insurance

Nearly everyone wants to be fully covered when it comes to auto insurance. And while full coverage insurance sounds good, unfortunately there is no single policy known as “full coverage.”

Instead, full coverage car insurance is another way of saying you are covered against liability to other people and for damage to your own vehicle.

But to be perfectly accurate, there is no such thing as full coverage insurance, which begs the question, what is full coverage auto insurance.

So, let’s start by going through what people mean when they ask what is full coverage insurance.

There are many different types of insurance coverage offered by your auto insurer. But in general, full coverage means you have liability coverage as well as comprehensive and collision coverage, as well as a few other very important coverage options that we will cover here in a second. 

Liability vs Full Coverage

The difference between liability vs full coverage comes down to who had damage, who was at fault, and ultimately, who is going to have to pay.

Liability insurance protects you from being sued if you are in a wreck. That’s because liability coverage pays to cover personal bodily injury and property damage suffered by someone else when you were at fault for an accident.

So, if you crash into a car at a stop sign, your liability coverage will pay to repair their vehicle and cover any medical expenses they incur.

Be careful, though, because there are limits to how much liability you are protected for, and that is defined by your policy.

So, if you have a state-minimum liability policy that has a $40,000 limit and you rear end a German luxury sedan, you could see where your policy limits might not fully protect you.

Everyone is required by law to purchase liability insurance, and it is a good idea to buy more than the minimum requires. 

So, then, what is full coverage?

Full coverage auto insurance on the other hand covers everything else. So, exactly what does full coverage car insurance consist of? To start, full coverage includes comprehensive and collision coverage.  

Collision coverage protects you from just what it sounds like – any damage to your vehicle that comes from a collision with something else. You could collide with a tree, another vehicle, or even a pothole, and collision insurance will pick up the bill after your deductible.

Comprehensive insurance picks up the bill for damage caused by just about anything else — be it theft, hail, a falling object, fire, etc.

But, if we are being technical, we still haven’t gotten to the full answer of what does full coverage insurance cover.

Full coverage insurance would also include things like uninsured/underinsured motorist coverage, medical coverage, rental reimbursement, and even towing and roadside assistance.

Uninsured/underinsured motorist coverage protects you if someone else is at fault for the accident, but they didn’t carry the state minimum liability insurance — or their liability insurance wasn’t enough to cover all the damages you incurred.

Medical coverage protects you and your passengers if someone gets hurt in an accident that is your fault.

Rental reimbursement picks up the cost of a temporary replacement vehicle while yours is being repaired from an accident. And roadside assistance is just that – they will come to your rescue if you have a flat tire, bad battery or even just run out of gas. 

Not everything is covered by full coverage

If you are asking what is full coverage car insurance, it might be because you want a full safety blanket protecting you from every possible scenario. But unfortunately, there are things that even full coverage auto insurance won’t protect you from.

Some of the things that nearly every full coverage car insurance policy excludes are:

  • Custom parts or equipment
  • Intentional damage
  • Mechanical breakdown
  • Off road use
  • Racing
  • Theft of items from your vehicle
  • Tire damage
  • War or nuclear disasters
  • Wear and tear

Is full coverage ever required?

Liability insurance is always required. But full coverage – or comprehensive and collision insurance - is typically only “required” if you borrowed money to purchase or leased your vehicle.

The rest of the time, deciding if you need liability vs full coverage, and even how much your coverage limits you need come down largely to your personal financial situation.

If you are wondering how much is full coverage car insurance, or if you are looking for cheap full coverage car insurance, a few rules of thumb can be helpful.

First, shop around. Second, look for bundles. Third, raise your deductible as high as makes sense. Fourth, exclude risky drivers who live with you (and don’t ever let them have the keys.)

Be smart about going cheap on your coverage limits, though. Sure, having a low liability coverage limit will save you a few bucks on your premium, but if you get into an accident, what’s to stop the other driver for suing you and going after your house or other assets?

It is common to ask how much is full coverage car insurance. And that really depends on a lot of factors, not the least of which are who you are and where you live. Here are a few of the biggest factors that weigh in on how much you are going to pay for full coverage auto insurance:

  • Driving history
  • Credit rating
  • Age
  • Gender
  • Marital status

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