Full Coverage Car Insurance

You should drop full coverage insurance on your car when the cost of the insurance premiums equals or exceeds the potential payout, should a covered event occur. You may also want to consider dropping full coverage if you are willing to pay for repairs out of pocket, or if you would prefer to replace your vehicle if it's damaged. For example, an older car with high mileage may not be worth costly repairs, and you might want to save for a new car instead of paying for extra insurance. Similarly, a driver who uses their car infrequently might take the gamble of dropping full coverage, since they are statistically less likely to damage their vehicle.

For those who aren't quite sure what it means exactly, “full coverage” is a catch-all term for insurance that covers you, other drivers, and your vehicles. It generally includes both collision and non-collision insurance. In other words, there is no single policy for "full coverage" car insurance. Instead, you select a combination of coverages that you feel is enough to handle all aspects of a car collision. With a well-rounded collection of coverages, you are “fully” protected from a variety of vehicular hazards, ranging from injuries and collision damage to weather events, encounters with wildlife, and vandalism.

However, it's important to remember that different states require different levels of coverage. Make sure to check state requirements before making any changes to an insurance policy.

You should consider dropping full coverage car insurance when...

• Your car is old or has a lot of miles. The less valuable your car is, the less likely it is that you need much coverage beyond your state's requirements. A good rule of thumb is that when your annual full-coverage payment equals 10% of your car's value, it's time to drop the coverage.
• You have a big emergency fund. If you don't have any savings, car damage might leave you in a severe bind. In that case, the money you spend on full coverage insurance will protect you from insurmountable repair bills. Consider keeping your full coverage insurance until you have some savings built up.

With that being said, it's wise to get full coverage for a new, rare, or expensive car. A $40,000 truck is worth the few hundred dollars a year for full coverage insurance, for example. Otherwise, you run the risk of having to drop another $40,000 on a new truck if you're involved in a serious accident.

Yes, you need full coverage on a financed car. Any reputable lender will require drivers with a loan or a lease to purchase comprehensive and collision insurance for their vehicle in addition to the state's minimum requirements for car insurance. Your contract with the lender might even require you to choose a specific deductible to ensure that you will be able to pay it if you file a claim.

Full coverage is required on financed cars to protect the lender's investment. This applies regardless of whether the vehicle is new or used.

When buying full coverage insurance for a car with a loan, you should notify your insurer that the car is financed, because your lender will need to be listed on the policy. As a result, your lender will be notified when your policy expires, is renewed, or is canceled. When your loan ends, you can notify your insurance company in order to have your lender removed from the policy.

If you purchase full coverage and then fail to maintain it, your lender may be able to purchase expensive force-placed insurance or even repossess your car. The good news is that having an auto loan is not considered a risk factor for insurers, so the loan itself will not increase your insurance premiums. Full coverage is more expensive than maintaining only your state's mandatory minimum coverage, though.

You can find affordable full coverage by checking out WalletHub's page on cheap car insurance and our guide to car insurance discounts.

Yes, Geico offers full coverage insurance. A Geico full coverage policy usually refers to car insurance that includes the state's minimum requirements along with collision and comprehensive insurance, which protect the policyholder's own vehicle.

The average cost of Geico full coverage car insurance is $1,675. This type of insurance is more expensive than a Geico liability-only policy since it provides more coverage.

Why Geico Full Coverage Is Worth It

A Geico full coverage policy is a good choice for drivers who don't want to pay out of pocket to repair or replace their car, even if they are at fault in an accident. Collision insurance covers the cost of fixing or replacing the policyholder's vehicle after an accident, regardless of who was at fault.

Similarly, comprehensive insurance covers the policyholder's car if it's damaged by something besides an accident, like vandalism, a fire, or a natural disaster. Collision and comprehensive are not mandatory in any state, but they are required for leased and financed cars.

Still, it's worth noting that full coverage is not the official name of any type of insurance, so be sure to clarify whether collision and comprehensive are included if you're purchasing a Geico policy. To learn more, check out WalletHub's guide to full coverage car insurance.

You do not need full coverage insurance on a used car unless the vehicle is leased or financed. Even though no state requires full coverage insurance, is still recommended for a used car if you cannot afford to repair or replace the car after an accident or other unexpected event. Full coverage is not an official type of insurance, but it usually refers to a policy that includes collision and comprehensive coverage in addition to the state's minimum required car insurance.

When deciding if you should buy full coverage insurance for a used car, consider the car's value, your savings, and where you live. For example, dropping full coverage could be worth it if you have an emergency fund that could comfortably cover the cost of repairs or a new car. But even if you could cover the loss yourself, it's wise to keep full coverage if your car is particularly valuable or you are especially likely to file a collision or comprehensive claim.

A general rule of thumb is to drop full coverage when the combined collision and comprehensive premium equals 10% of your car's value. But a lot depends on your own financial situation and vehicle.

If you don't keep full coverage on a financed car, you could be held responsible for paying for the vehicle in its entirety in the event of theft or an auto accident. You could also lose the car to the lender you signed a contract with if you don't keep full coverage on your financed car.

Nearly all lenders require that drivers carry full auto insurance coverage when they initially finance a vehicle. Lenders also usually stipulate in the contract that some form of full coverage is to be maintained for the life of the loan. Auto lenders impose the full coverage requirement because they want the vehicles they finance, which are technically still their assets, to be protected with the most insurance coverage possible so they can collect the vehicle's value in case of an accident or theft of the car.

So, if you don't keep full coverage on a financed vehicle, whether because you miss payments or you purposefully cancel the coverage, you're likely in breach of your contract. Your insurance company or the DMV may contact the lienholder (lender) to alert them of the change, at which point your lender can legally cancel your contract, request full payment of the loan, or even repossess the vehicle.

Sometimes, if your lender finds you're not keeping full coverage on a financed vehicle, it will contact you to give you a chance to have it reinstated. If you fail to do this, your lender could purchase an auto insurance policy for the vehicle and add it to the cost of your loan in what's called “force-placed insurance.” These policies are typically expensive.

Ultimately, it's best to keep full coverage on a financed car until you own it outright. Only then can you choose the level of car insurance coverage you want, as long as it meets your state's minimum requirements.

Liability insurance is 64% cheaper than full coverage, on average. Liability car insurance costs an average of $720 per year, while full coverage car insurance averages $1,997 per year, according to WalletHub data for 2021. The exact cost difference between liability and full coverage insurance depends on factors such as the driver's state, vehicle, and driving history.

Full Coverage vs. Liability Insurance Cost by Company

Note: Rates reflect average annual costs in California.

Why Full Coverage Is More Expensive Than Liability Insurance

Full coverage insurance is more expensive than a liability-only policy because it offers broader protection. Liability insurance only pays for other people's repair expenses and medical bills after accidents that you cause. On the other hand, full coverage includes liability insurance plus collision and comprehensive coverage, which pay to repair or replace your vehicle after an accident or other damage-causing event.

To learn more, check out WalletHub's guide to liability vs. full coverage insurance.

Yes, Progressive offers full coverage insurance. A Progressive full coverage policy usually refers to car insurance that includes the state's minimum requirements along with collision and comprehensive insurance, which protect the policyholder's own vehicle.

The average cost of Progressive full coverage car insurance is $2,021. Full coverage from Progressive is more expensive than a Progressive liability-only policy, since it provides more coverage.

A Progressive full coverage policy is a good choice for drivers who don't want to pay out of pocket to repair or replace their car, even if they are at fault in an accident. Collision insurance covers the cost of fixing or replacing the policyholder's vehicle after an accident, regardless of who was at fault. Similarly, comprehensive insurance covers the policyholder's car if it's damaged by something besides an accident, like vandalism, a fire, or a natural disaster. Collision and comprehensive are not mandatory in any state, but they are required for leased and financed cars.

Still, it's worth noting that full coverage is not the official name of any type of insurance, so be sure to clarify whether collision and comprehensive are included if you're purchasing a Progressive policy. To learn more, check out WalletHub's guide to full coverage car insurance.

Yes, Liberty Mutual offers full coverage insurance. A Liberty Mutual full coverage policy usually refers to car insurance that includes the state's minimum requirements along with collision and comprehensive insurance, which protect the policyholder's own vehicle.

The average cost of Liberty Mutual full coverage car insurance is $2,758. Full coverage from Liberty Mutual is more expensive than a Liberty Mutual liability-only policy, since it provides more coverage.

A Liberty Mutual full coverage policy is a good choice for drivers who don't want to pay out of pocket to repair or replace their car, even if they are at fault in an accident. Collision insurance covers the cost of fixing or replacing the policyholder's vehicle after an accident, regardless of who was at fault. Similarly, comprehensive insurance covers the policyholder's car if it's damaged by something besides an accident, like vandalism, a fire, or a natural disaster. Collision and comprehensive are not mandatory in any state, but they are required for leased and financed cars.

Still, it's worth noting that full coverage is not the official name of any type of insurance, so be sure to clarify whether collision and comprehensive are included if you're purchasing a Liberty Mutual policy. To learn more, check out WalletHub's guide to full coverage car insurance.

Yes, State Farm offers full coverage insurance. A State Farm full coverage policy usually refers to car insurance that includes the state's minimum requirements along with collision and comprehensive insurance, which protect the policyholder's own vehicle.

The average cost of State Farm full coverage car insurance is $2,617. Full coverage from State Farm is more expensive than a State Farm liability-only policy, since it provides more coverage.

A State Farm full coverage policy is a good choice for drivers who don't want to pay out of pocket to repair or replace their car, even if they are at fault in an accident. Collision insurance covers the cost of fixing or replacing the policyholder's vehicle after an accident, regardless of who was at fault. Similarly, comprehensive insurance covers the policyholder's car if it's damaged by something besides an accident, like vandalism, a fire, or a natural disaster. Collision and comprehensive are not mandatory in any state, but they are required for leased and financed cars.

Still, it's worth noting that full coverage is not the official name of any type of insurance, so be sure to clarify whether collision and comprehensive are included if you're purchasing a State Farm policy. To learn more, check out WalletHub's guide to full coverage car insurance.

Yes, Allstate offers full coverage insurance. An Allstate full coverage policy usually refers to car insurance that includes the state's minimum requirements along with collision and comprehensive insurance, which protect the policyholder's own vehicle.

The average cost of Allstate full coverage car insurance is $2,324. Full coverage from Allstate is more expensive than an Allstate liability-only policy, since it provides more coverage.

An Allstate full coverage policy is a good choice for drivers who don't want to pay out of pocket to repair or replace their car, even if they are at fault in an accident. Collision insurance covers the cost of fixing or replacing the policyholder's vehicle after an accident, regardless of who was at fault. Similarly, comprehensive insurance covers the policyholder's car if it's damaged by something besides an accident, like vandalism, a fire, or a natural disaster. Collision and comprehensive are not mandatory in any state, but they are required for leased and financed cars.

Still, it's worth noting that full coverage is not the official name of any type of insurance, so be sure to clarify whether collision and comprehensive are included if you're purchasing an Allstate policy. To learn more, check out WalletHub's guide to full coverage car insurance.