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Guide to Full Coverage Auto Insurance

Published June 7, 2022
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Full Coverage Auto Insurance

When reviewing your auto insurance options for the first time or at renewal time, you’ll have the opportunity to purchase full coverage.  Why should you consider purchasing full coverage? Because, what is covered by basic auto insurance is, frankly, minimal.

Buying a new or expensive vehicle is also a good time to consider additional safeguards. Doing so will provide you and your car with better protection when you’re involved in an accident.

This type of coverage goes beyond state minimum requirements to give you better peace of mind by combining different coverage options. 

Let’s take a look at what types of insurance coverages are available for your vehicle and how to save on these additional options. By looking at what to consider, you can decide if it makes sense for you to get full coverage on your vehicle. 

What this article covers:

  • The meaning of the term “full coverage” in car insurance.
  • What’s included in a full coverage auto policy?
  • Do drivers really need to be fully covered?
  • When is full coverage auto insurance worth it?
  • Rates you can expect to pay for your car to be fully covered.
  • Ways to save on full coverage for your vehicle.

What you should know:

  • Getting full coverage on your vehicle is not automatic but recommended for better protection in case of an accident.
  • Costs for full coverage are, as expected, much higher than minimum insurance limits that are required by states.
  • Not every situation warrants being fully covered but may be required if your vehicle is new, if your car is financed, if you lease your car, or if you live in areas with harsh weather. 

What does the term “full coverage” mean?

Full coverage is a term used in the insurance industry that refers to insurance that combines coverages to help protect you and your vehicle in most circumstances. Coverages usually include liability, comprehensive, and collision protection. 

J.D. Power suggests that this term can be “misleading” and give a false sense of security. Although these options are combined to increase what is covered on your car, the term “full coverage” does not refer to an actual policy type. Instead, it refers to what is included in your policy. So, it’s important to choose the right options for your needs.

What is included in a policy that offers full coverage? 

If you are looking for vehicle insurance and want your auto fully covered, your policy will typically include comprehensive coverage and collision (comp and collision) in addition to required liability. 

The comp and collision will cover (pay for) damages to your own car in case of an accident. Liability, on the other hand, will pay for the injuries and damages to others and their vehicle when you are at fault in an accident. 

The full coverage protection includes damage caused in an accident that is your fault. In addition, most types of incidents would be covered including those that might be out of your control like hitting an animal with your vehicle, severe weather conditions, vandalism, or theft.

But don’t confuse the word “full” with the term “complete” as some extras are not included unless you want and request them separately. These extra safeguards might include emergency roadside assistance, new car replacement, and custom equipment/parts as well as Uninsured Motorist insurance, medical expense, or gap insurance. 

Types of protection that may be included with full coverage car insurance:

Type of CoverageRequirementsWhat is Covered
Collision May be required when financing or leasing your vehicle.Repair bills - when you're involved in an accident or hit an object (e.g., fence, tree, etc.)
Comprehensive May be required when financing or leasing your vehicle.Repair bills - when damage occurs as a result of incidents that happen outside your control (e.g., weather, vandalism, theft, hitting an animal, etc.) 
Bodily Injury Liability (BI)Required in nearly all states.Medical bills - when injuries or deaths are a result of an accident that is your fault.
Property Damage Liability (PD)Required in all states.Repair bills - when you damage property in an accident.
Uninsured Motorist Bodily Injury (UIM BI)Required in 21 states and Washington, DCMedical bills – if you get in an accident with an uninsured motorist/driver.
Uninsured Motorist Property Damage (UIM PD)Required in 7 states and Washington, D.C.Repair bills – if you get in an accident with an uninsured motorist/driver.

Why do drivers need full coverage insurance for their vehicles?

The reality is that accidents and other unforeseen events can happen at any time and cause injury or damage to you and others. Whenever you get behind the wheel, you are at risk of causing or being involved in an accident. According to the NHTSA, in 2019, there were 6,756,000 police-reported accidents nationally. 

When you are at fault, you are responsible for the injuries and damages that you cause. This liability can run into thousands, if not tens of thousands of dollars resulting from medical and property damage costs. 

And sometimes things happen even when you’re not driving your car. Severe weather, theft, and vandalism can damage your vehicle when you’re not around. 

Unfortunately, if you settle for minimum insurance requirements in your state, you may end up owing more than you can afford to pay in medical bills and vehicle/property damage caused by you. Getting full protection will help pay for these costs whether it’s your fault or due to occurrences beyond your control. 

Finally, if you are financing or leasing a vehicle, you may be required to include comprehensive and collision insurance, which in most cases, is added together to your policy.

Is full coverage auto insurance really worth it?

Being fully covered is not the cheapest car insurance. The cost is twice as expensive as minimum liability insurance rates. According to NerdWallet in an August 2021 article, full coverage car insurance, “…is more than double the cost of minimum coverage, on average, according to our analysis.” Since full coverage is not required, making the decision to purchase combined protection options will depend on your needs. 

If you decide to only buy the state’s minimums (low amounts of liability insurance), you could leave yourself susceptible to financial hardship when involved in an at-fault accident. That’s because liability doesn’t cover your medical costs or auto repairs. It will only cover injuries and repairs to vehicles belonging to others involved in the accident you caused. Think what it would cost you if your car is totaled.

When deciding what is best for your situation, think about the value of your car versus the costs of increased coverages. For example, if you have an older vehicle, having comp and collision will only provide protection based on what your car is worth when the incident occurred. In addition, you may have a deductible (out-of-pocket expenses) that may leave you with less than your car’s value at the time.

So, when does full coverage for your auto make sense? Is it a sound investment? There are a few reasons why you should consider the investment. 

  • Your car is financed (e.g., auto loan).
  • Your car is being leased.
  • You purchased a new vehicle.
  • You purchased an expensive car that incurs higher repair or replacement costs.
  • You’re unable to afford the repair or replacement of your car if an accident occurs or if stolen.
  • You commute in your vehicle on a regular basis in heavy traffic.
  • You reside in areas of higher risks including instances of theft, severe weather, or accidents involving animals.

What can I expect to pay to be fully covered?

The bottom line is that you can expect to pay more than double what minimum state-required limits would cost. Although more expensive, it provides far more coverage depending on what options you add on top of your state’s minimum requirements. 

The idea is to arm yourself with as much car insurance you can afford to protect yourself and your car in case of an accident and other unforeseen incidents. For example, NerdWallet found that in 2021, the minimum required insurance coverage in Ohio was $351, while full coverage would cost an estimated $989.

Note: The below NerdWallet analysis of insurance company rates in 2021 illustrates the wide differences within state rates. 

Full and minimum car insurance annual average costs by state

StateFull coverageMinimum coverageAnnual difference
Alabama$1,501$474$1,027
Alaska$1,521$417$1,104
Arizona$1,536$567$968
Arkansas$1,883$495$1,388
California$1,911$617$1,294
Colorado$2,012$528$1,484
Connecticut$1,791$841$950
Delaware$1,733$823$910
Florida$2,321$685$1,636
Georgia$1,820$757$1,063
Hawaii$1,049$326$723
Idaho$998$320$678
Illinois$1,397$468$929
Indiana$1,179$383$796
Iowa$1,151$255$896
Kansas$1,600$464$1,136
Kentucky$2,363$790$1,574
Louisiana$2,762$895$1,867
Maine$963$372$591
Maryland$1,872$860$1,011
Massachusetts$1,100$431$669
Michigan$2,387$1,128$1,259
Minnesota$1,418$559$859
Mississippi$1,636$498$1,138
Missouri$1,526$484$1,043
Montana$1,726$362$1,364
Nebraska$1,376$365$1,010
Nevada$2,161$839$1,322
New Hampshire$1,169$429$740
New Jersey$1,860$851$1,009
New Mexico$1,418$390$1,028
New York$2,131$1,070$1,061
North Carolina$1,212$410$801
North Dakota$1,195$352$843
Ohio$989$351$638
Oklahoma$1,748$451$1,297
Oregon$1,358$670$688
Pennsylvania$1,406$431$974
Rhode Island$2,043$842$1,201
South Carolina$1,652$606$1,046
South Dakota$1,455$301$1,154
Tennessee$1,298$400$898
Texas$1,610$560$1,050
Utah$1,390$577$813
Vermont$1,123$338$785
Virginia$1,248$478$771
Washington$1,234$457$777
Washington, D.C.$1,880$736$1,144
West Virginia$1,605$517$1,088
Wisconsin$1,160$361$799
Wyoming$1,369$335$1,035

Source: NerdWallet

How can I save when purchasing full coverage auto insurance?

  • Priority #1 is to shop around for the best rates. This will help to ensure you’re getting competitive rates that will meet your insurance needs. 
  • Be sure to ask your insurer for any applicable discounts that might apply to you or your family’s situation. 
  • Drive safely! Getting good rates in any state or scenario generally means safe driving that is void of accidents or traffic violations. 
  • Maintain a good credit rating as your credit can affect your insurance costs.

For more answers to your insurance questions, check our FAQs for guidance.

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