Understanding Full Coverage Auto Insurance: What You Need To Know

Full coverage auto insurance is a combination of liability, collision, and comprehensive insurance. It provides financial protection in most scenarios, including damage to your car from weather, accidents, vandalism, or theft. While it is not a special type of policy, it offers more protection than a policy with just the minimum liability insurance required by your state.

Liability insurance

When purchasing liability insurance, you will encounter coverage limits described by three numbers. For example, a policy might have coverage limits of $15,000 per person, $30,000 total per accident, and $5,000 to cover property damage liability. These limits represent the maximum amounts that the insurance company will pay out for bodily injury and property damage claims.

While liability insurance is a fundamental aspect of full-coverage auto insurance, it's important to remember that "full coverage" is a misleading term, as it doesn't cover every possible scenario. Full-coverage auto insurance typically includes liability insurance, collision insurance, and comprehensive insurance, offering a more comprehensive level of protection.

Collision insurance

If you are financing or leasing your car, your lender will likely require you to have collision coverage. Even if you own your vehicle outright, collision insurance might be a good idea if you can't afford to repair or replace it in the event of an accident.

It's important to note that collision insurance does not cover damage due to theft or vandalism, or damage that is covered by another driver's policy if they are at fault. Additionally, it does not cover damage or injuries you cause to others, medical costs from injuries to yourself or your passengers, personal belongings inside your car, or normal wear and tear.

Comprehensive insurance

• Vandalism
• Fire and explosions
• Windshield and glass damage
• Falling trees/limbs and other objects
• Rocks/objects kicked up by or falling off cars
• Storms, hail, wind, floods, lightning, and earthquakes
• Accidents with animals (e.g. hitting a deer)

Uninsured motorist coverage

There are two types of UM coverage: uninsured motorist bodily injury and uninsured motorist property damage. The former covers medical bills related to a crash, while the latter pays for repairs to your car. In some states, only uninsured motorist bodily injury coverage is available.

UM coverage can also provide protection in the event of a hit-and-run accident, as the fleeing driver is considered an uninsured motorist. If you are involved in an accident with an uninsured driver, your UM coverage can help cover vehicle repairs or medical bills resulting from the incident.

In addition to protecting against uninsured drivers, underinsured motorist coverage (UIM) is also available. This type of coverage applies when the at-fault driver has some insurance but not enough to fully cover your damages. Some states that require UM coverage also mandate UIM coverage, but this varies, so it is important to check with your state's Department of Motor Vehicles.

Overall, uninsured motorist coverage is a valuable component of full-coverage auto insurance, providing financial protection in the event of an accident with an uninsured or underinsured driver. This coverage can help ensure that you and your passengers receive the medical care and vehicle repairs needed without incurring significant out-of-pocket expenses.

Personal injury protection

PIP covers medical bills for you and anyone covered on your policy. In some states, non-medical benefits such as coverage for lost wages, household services, and disability can protect you, your passengers, and family members in your household, even if they're not on your policy.

Depending on the state, PIP may cover:

• Medical bills for you and those covered on your policy (also covers you if you're hit by a car while walking or riding a bike)
• Lost wages if you or your passengers are injured and can't work
• Household services such as childcare, house cleaning, or yard work
• Disability and rehab costs
• Death benefits (paid to your family if you're in a fatal car accident)

PIP doesn't cover you for expenses unrelated to personal injuries after an accident, such as damage to your vehicle, theft of your vehicle, or damage to someone's property.

In most no-fault insurance states, drivers are still required to carry bodily injury liability coverage to pay for injuries that exceed the state's threshold for bodily injury lawsuits.

Frequently asked questions