What Does Full-Coverage Car Insurance Cover?

Full-coverage car insurance handles your own expenses that liability coverage alone does not. Liability insurance by itself only covers damages and injuries to others involved in an accident, none of your own.

Full-coverage auto insurance isn’t required by state law, but you will probably need to get it if you finance or lease a car. It’s also good to have if your car is new or expensive.

What does full-coverage auto insurance cover?

Full-coverage insurance usually includes three types of coverage: liability, collision and comprehensive. It covers damage and injuries to others, along with your own expenses due to the damage to or theft of your car

Liability insurance

Liability insurance protects you from expenses tied to injuries and damage you cause to others. This includes legal fees, court-ordered fines and medical bills.

The biggest difference between liability insurance by itself and full-coverage car insurance is that liability insurance only covers the expenses of others. Full-coverage insurance pays the expenses of others as well as your own.

Collision insurance

Collision insurance covers the repair or replacement of your vehicle after a covered peril damages or totals it.

Collision insurance comes into play in accidents that you cause. If another driver causes damage to your car, their liability insurance usually covers it.

Comprehensive insurance

Comprehensive insurance covers damage to your vehicle that’s not caused by a collision. This includes:

• Theft and vandalism
• Fire
• Ice and hail damage
• Collision with an animal
• Flood

While theft of your car is covered under comprehensive insurance, theft of personal property within your car is not. That would be covered under your renters or home insurance policy.

Other coverages

There are other types of car insurance you may be required to get, depending on the state you live in. They include:

• Personal injury protection (PIP): PIP covers injury-related expenses you may accrue after an accident. This includes medical expenses, rehabilitation costs and lost wages. PIP is usually mandated in “no-fault” states, where your insurance company pays for your medical expenses no matter who causes an accident.
• Uninsured and underinsured motorist coverage: These coverage types cover your medical and property damage expenses if you are hit by a driver with no liability insurance or not enough.

How much does full-coverage car insurance cost?

According to the Insurance Information Institute’s most recent data, the average cost for full-coverage car insurance is $1,588 a year, or $132 a month. Your final full-coverage rate depends on many factors, including:

• The make and model of your car
• Your ZIP code
• Your insurance claim record
• The coverage limits you choose
• Your deductible

Do I need full coverage on my car?

Full-coverage car insurance is not needed under any state law, but your lender will probably require it if you lease or finance your vehicle.

Even if you are not required to have it, though, is full-coverage car insurance worth it?

If you have a new or expensive car, full-coverage insurance can be an excellent investment. If you have an older car, the payout may not be worth the cost of a full-coverage policy.

How do I get affordable full-coverage insurance?

To get the cheapest full-coverage car insurance, take these steps:

• Compare quotes from many different car insurance companies: Start off by getting several full-coverage insurance quotes from different providers. Use the same limits and deductible amounts for each to get the best comparison. Check each company’s customer satisfaction ratings from J.D. Power and the NAIC Complaint Index as well.
• Raise your deductible: The higher your deductible, the lower your car insurance rate. This relies on it fitting in your budget if you do need to file a claim, but it can be a good step to take if you have a clean driving record.
• Discounts: Most auto insurance companies offer a range of discounts to stay competitive. Ask an agent what discounts are available to drive your rate down.