Liability Auto Insurance: Comprehensive Coverage?

Liability insurance is a legal requirement for driving in most states. It covers the cost of damage to other vehicles or injuries to other people when you're driving. However, it does not cover damage to your own vehicle. Comprehensive insurance is an optional extra that covers damage to your car from non-collision events, such as storms, theft, or vandalism. So, while you can't have comprehensive insurance without liability insurance, you can have liability insurance without comprehensive insurance.

What does liability auto insurance cover?

Liability auto insurance covers the costs of the other driver's property and bodily injuries if you are found at fault in an accident. This includes medical expenses, lost wages, and legal fees if the injured party files a lawsuit, as well as vehicle repair or replacement costs, and other property damage.

Liability insurance consists of two types of auto coverage: bodily injury liability protection and property damage liability protection.

Bodily injury liability protection covers the medical expenses of the other party if you are at fault in the accident. In some cases, it may also cover lost wages and legal fees if the injured party sues.

Property damage liability protection covers damages to property resulting from a covered accident where you are at fault. This includes the other party's vehicle repair or replacement costs, as well as damage to other property such as fences, structures, and telephone poles.

It is important to note that liability insurance does not cover your own vehicular damage or personal injury costs. For that, you will need comprehensive and/or collision coverage.

What does full coverage auto insurance include?

When people refer to "full coverage" auto insurance, they are generally talking about a combination of liability, comprehensive, and collision coverage, plus any other coverages that are required by your state.

Liability coverage is mandatory in almost all states. It covers damages or injuries you cause to another vehicle or person, up to a certain limit.

Comprehensive coverage pays for damage to your car caused by a variety of accidents that aren't traffic-related. This includes weather events, such as hail, floods, or tornadoes; falling objects, such as tree limbs; car theft and broken windows; and vandalism or civil disobedience, such as a riot. Comprehensive coverage does not cover damage or injuries you cause to others while driving, your own injuries after an accident, damage to your car from a collision with another driver or object, personal belongings inside your car, damage from potholes, or normal wear and tear.

Collision coverage, which covers damage to your car after a crash, can pay to repair or replace your vehicle, minus your deductible, if your vehicle collides with a car, motorcycle, tree, guardrail, or any other object—regardless of fault.

Full coverage auto insurance is a general term used by agents, lenders, and dealerships, and there is no consensus on what it means. No insurer can sell a policy where you are 100% covered in all situations.

When should you choose liability-only insurance?

Liability-only insurance is the minimum coverage you need to be financially responsible if you cause an accident that injures others or damages their vehicle. It covers the third party's property damage and personal injuries in the event of an accident.

You should choose liability-only insurance if:

• You have an older, lower-value car.
• You have enough savings to handle car repair or replacement following an accident.
• You do not want to pay for car repair or replacement following an accident.
• You are a safe driver and are confident that you will not be at fault in an accident.
• You are looking for ways to lower your premium costs.

However, it is important to note that liability-only insurance does not cover damage to your own vehicle or your own injuries in the event of an accident. If you are at fault in an accident, you will have to pay for your own repairs and injuries out of pocket.

Additionally, if you have a loan or lease on your vehicle, your lender may require you to have full coverage insurance, which includes collision and comprehensive coverage, in addition to liability insurance. Full coverage insurance provides added protection for your vehicle in the event of an accident, theft, or damage caused by factors other than a collision, such as fire or flooding.

When is full coverage worth the extra cost?

Full coverage car insurance is typically a combination of comprehensive, collision, and liability coverage. It provides coverage for most scenarios, including damage to your car from the weather, an at-fault accident, hitting an animal, or vandalism.

The cost of full coverage car insurance varies depending on the insurance company, where you live, and other factors. The average cost of full coverage car insurance in the US is $1,895 per year or $158 per month.

• You have a new or expensive car: Full coverage insurance is essential to protect your investment in your vehicle. It can help you avoid a large out-of-pocket expense if an accident happens.
• You drive frequently or live in areas with high traffic or inclement weather: If you are on the road a lot or live in an area with a higher risk of accidents or damage due to weather, full coverage can provide valuable protection.
• You rely heavily on your vehicle for daily activities: Even if your car is older, full coverage can be beneficial if you depend on it for your daily needs and cannot afford to cover repair or replacement costs out of pocket.
• You have a loan or lease on your vehicle: If you are financing your vehicle, your lender will likely require full coverage to protect their investment. This is usually mandatory until you finish paying off the loan.
• You live in an area with extreme weather, high car theft rates, or a high risk of animal collisions: Full coverage can provide peace of mind and protect you financially in these situations.

Ultimately, the decision to opt for full coverage car insurance depends on your specific circumstances, including your financial situation, the type of car you drive, and your risk tolerance.

What are the average costs of liability vs. full coverage?

Yes, you can have liability insurance without comprehensive auto insurance. Liability insurance is required in most states, except for New Hampshire and Virginia. However, full coverage insurance is not required in any state.

Full coverage insurance includes liability, collision, and comprehensive insurance. Collision and comprehensive insurance are generally required if you have a car loan or lease. They cover repairs if your vehicle is damaged due to problems such as a car accident, fire, or flood.

The average national cost for full coverage insurance is $1,718 a year, according to a June 2024 analysis by NerdWallet. The liability portion of a car insurance policy is usually the most expensive component. The average national cost for liability insurance is about $650 a year, according to the National Association of Insurance Commissioners (NAIC).

The cost of your auto insurance policy is determined by factors including your age, vehicle, driving record, state, and city. Purchasing a policy that meets the minimum limits set by your state allows you to drive legally, but there are advantages to paying for increased coverages.

Frequently asked questions