“Full coverage” insurance is a car insurance term used to describe a policy that includes collision and comprehensive coverage, in addition to the bodily injury and property damage liability coverage required by law. Full-coverage car insurance covers the policyholder’s injuries and vehicle damage, not just the other driver.
The term full coverage is commonly used by consumers. However, it does not have an official definition within the insurance industry. That’s why you may come across a few different variations of what it includes.
What Is Full Coverage? Common Definitions:
- A policy that includes liability, collision and comprehensive
- A policy that includes the state minimum coverage, plus any additional insurance required by the lender that financed your car.
- Coverage that will take care of anything and everything in the event of a crash or incident.
Types of Full Coverage Car Insurance
Although full coverage does not have an exact definition, it usually refers to a policy that includes liability, comprehensive, and collision insurance.
Liability insurance covers injuries and property damage that you cause to other people when you’re at fault for a car accident. While many states allow drivers to carry liability insurance alone, it doesn’t cover any costs incurred by the policyholder. If you want insurance to pay for damage to your vehicle, you need to have collision and comprehensive coverage.
Collision insurance repairs or replaces your car after an accident, regardless of who is at fault. Comprehensive coverage, on the other hand, will repair or replace your vehicle when it is damaged by something other than an accident, such as vandalism or a natural disaster.
Combined, these three types of insurance are considered “full coverage” because they protect you financially in a wide range of situations. However, since full coverage is a loose term, it can include other types of insurance as well.
For instance, you can add personal injury protection (PIP) to pay for your medical expenses after an accident. And you can purchase uninsured/underinsured motorist coverage to protect you in the event that you are harmed by a driver who either has no insurance or not enough coverage to pay for all of your expenses. However, some states require these types of coverage anyway.
Cost of Full Coverage Car Insurance
The average cost of full coverage car insurance is $1,494 per year. In comparison, state minimum coverage costs an average of $588 annually. Costs vary not only by state and insurance company, but also by limits and deductibles.
For example, purchasing a full coverage policy with high collision and comprehensive deductibles will allow you to pay a lower monthly rate. Similarly, you can choose a policy with low payout limits for liability insurance in order to pay a lower premium.
Cheapest Full Coverage Car Insurance
To find the best cheap full coverage car insurance, you should get multiple quotes from different insurers in order to identify the lowest rate for the coverage you need. Premiums vary based on several factors, including your state and driving record. But in general, the companies listed below offer the best cheap full coverage auto insurance.
Cheapest Full Coverage Car Insurance Companies
3 Tips For Buying Full Coverage Car Insurance
1. Choose the right types of insurance.
Start with the insurance that you’re required to carry. Then, if you have an auto loan or your car is fairly new, you may need or want to purchase collision and comprehensive insurance.
Ask yourself whether you could come up with the money to replace your car after a serious accident. If the answer is no, then collision and comprehensive insurance are important additions to your coverage.
On the other hand, if you own an older car outright and it doesn’t have a high blue book value, then collision and comprehensive policies are probably not worth it. You’ll pay more for insurance in just a few years than your car is worth.
To make an educated decision, learn more about the many types of car insurance that are available.
2. Choose the right coverage limits.
When you select a liability insurance policy, you will choose specific dollar-amount limits of how much it will cover. To protect yourself and others you may harm in an accident, choose the highest limits for liability coverage you can afford.
You can reduce your premiums by choosing just the minimum required by state law, but keep in mind that your responsibility after an accident doesn’t stop at your coverage limits. If your insurance doesn’t cover all of the medical expenses and property damage you cause, you are still responsible for the rest.
3. Choose the right deductibles.
A car insurance deductible is the amount you must pay after a covered loss before your insurance kicks in. Some types of coverage, such as collision and comprehensive, will have a deductible you can select. You can save on insurance premiums by selecting a higher deductible, but make sure the deductible you choose is one you could afford to pay. The higher your deductible, the more you pay out of pocket after an incident.