When shopping for car insurance, you’ve likely come across the term full coverage car insurance. Although this may sound like an insurance policy that covers you in any situation, the phrase is a bit misleading.
Most insurance agents use “full coverage” to describe a car insurance policy that includes comprehensive, collision, and liability coverage. However, since everyone’s insurance needs are different, your definition of being “fully” covered may differ than someone else’s. To help you build your ideal car insurance policy, let’s dive into some basics of common coverages that ensure all your assets are protected.
What Is Considered Full Coverage Car Insurance?
Although there is no formal definition of full coverage, the term typically describes a car insurance policy that includes liability, comprehensive, and collision coverage. Let’s break those down first.
- Liability Insurance: Protects you financially if you are responsible for causing injury to another person or damage to their property.
- Comprehensive Coverage: Covers your vehicle against damage from events outside of your control, such as theft, vandalism, weather accidents, or falling debris.
- Collision Coverage: Covers repair or replacement costs if a collision with another car or object damages your vehicle.
When you carry all three of these coverages, your auto insurance policy will cover damage to your car as well as injuries or damage you cause to others, up to your policy’s limits.
Do I Need Full Coverage Car Insurance?
Carrying comprehensive and collision coverages is not required in any state, but your lender may require that you purchase additional coverage if you are financing or leasing a car. In most states, only liability insurance is required by law. However, here are a few situations where it would benefit you to have the extra coverage:
- High-value car: If you own a luxury car, purchasing comprehensive and collision coverage is a wise decision to help with repair or replacement costs in the event of an accident.
- Risky conditions: If you live in an area with high car theft rates or extreme weather, the added protection could help you avoid a large out of pocket expense.
- Limited assets: If you can’t afford to repair or replace your car out of pocket, add-on coverages can help ensure you don’t lose vehicle access.
In the above situations, purchasing full coverage can often be cheaper than replacing a new car.
However, there are some instances when adding on coverage may not be worth it. For example, if you drive a low value or older value car, comprehensive and collision coverage will only reimburse you up to your vehicle’s actual cash value, or the amount it was worth immediately before the accident. Plus, these coverage types often include a deductible, which you must pay out of pocket toward your repair or replacement costs. If your deductible is more than what your car is worth, it may make sense to skip the add-on coverage.
How Much Does Full Coverage Insurance Cost?
Your car insurance premium is based on multiple factors, but a policy that includes physical damage protection will normally cost more than liability insurance alone. How much you pay for full coverage will ultimately depend on your location, vehicle make/model, and the deductible you choose.
One of the easiest ways to find an affordable car insurance policy without sacrificing coverage is to compare quotes from multiple companies. Click here to start a free quote today and compare rates from top carriers with AIS.
Additional Car Insurance Coverages to Consider
Despite its name, full coverage car insurance does not refer to having every single type of coverage available on your auto policy. That’s because everyone’s insurance needs are different. Still, there’s no limit to the number of coverages you can purchase to customize your policy for your specific needs. Here’s a quick rundown of common coverage types available from most insurers that can enhance your protection:
- Uninsured/Underinsured Motorist Coverage: Thiswill provide coverage if an underinsured (UIM) or uninsured (UM) motorist hits your car and cannot cover all your medical or property damage expenses. Some states require drivers to purchase UM/UIM coverage, but most do not.
- Personal Injury Protection: This covers expenses such as medical bills, lost wages, funeral expenses, and more for you and your passengers. Only a few states require this coverage.
- Gap Insurance: If you total a car that you are leasing or financing, gap insurance can cover the difference between what you owe and what your car was worth before the accident.
- Rental Car Reimbursement: Rental car reimbursement will reimburse the cost of a rental car while your primary vehicle is repaired from a covered accident.
- Roadside Assistance: Provides roadside aid if you need a tow, tire change, battery jump, or locksmith service.
AIS Can Help You Get the Coverage You Need
When it comes to car insurance, understanding the difference between common coverage types can help you build a policy that suits your specific needs. However, with so many insurance companies and coverages available, doing so can seem overwhelming. Thankfully, AIS can help.
With over 55 years of experience, our specialists have helped countless customers find and secure reliable car insurance without breaking the bank. And with our network of highly rated insurance partners, we can help you find your ideal match no matter how much protection you need. To learn more about how AIS can help you today, give us a call at (888) 772-4247, or start a free quote online.
The information in this article is obtained from various sources and offered for educational purposes only. Furthermore, it should not replace the advice of a qualified professional. The definitions, terms, and coverage in a given policy may be different than those suggested here. No warranty or appropriateness for a specific purpose is expressed or implied.
