Is Full Coverage Insurance Right for Me?

Full coverage insurance is a good fit for most people who drive, especially when they still owe on their vehicle. The only time liability-only would be a considerable option is if your car is so old that the value is not enough to justify the cost of coverage. Just keep in mind, liability only leaves you paying the repair costs yourself or replacing the vehicle on your own. 

If you don’t want to take that risk and would like to learn more about full coverage insurance, read on!

How Much Does Full Coverage Car Insurance Cost?

According to the folks at Cheap Full Coverage Auto Insurance, the average cost for full coverage insurance in the U.S. is around $1,190 a year or just around $99 per month. However, there is no one size fits all approach to pricing car insurance. For one thing, averages such as those presented by Cheap Full Coverage Auto Insurance do not factor in add-on features. Factors such as age, gender, vehicle, driving history, state of residence, demographics, and more will also determine how much you will pay for full coverage insurance.

You may end up paying more or less with your insurance carrier based on your unique situation and needs. Keeping a clean driving record, making payments on time to your lender, and not owning a luxury vehicle are great ways to keep your rates as low as possible. 

Understanding Full Coverage Car Insurance

When thinking about full coverage insurance, we often assume it covers everything; but if you aren’t careful, you won’t know where your coverage ends, and the fine print begins. Not getting the right full coverage plan for your needs can lead to higher out-of-pocket costs in the event you file a claim. The term full coverage can mean a few things, so it’s important to understand the different components to ensure you receive optimal coverage.

What Is Included with Full Coverage Car Insurance?

Full coverage car insurance is a plan that typically includes the minimum liability required and often includes comprehensive and collision coverage as well.

Liability coverage is the minimum standard for coverage in most states and covers the cost of damages in the event you are at fault for an accident, up to your policy amount. There are varying levels of liability coverage out there, so it is wise to do your research if you want to get the most coverage for the best rate.

Collision coverage will cover the costs of damages in the event someone else is at fault for an accident that involves your vehicle. Collision coverage is included in pretty much every type of full coverage plan out there, but since there are varying coverage levels, it is wise to consider the value of your vehicle and what you still owe to determine what limit is best.

Comprehensive coverage covers the cost of damages in the event a natural disaster or just about any event that causes damage to your vehicle, aside from car collisions. Although not required by state, comprehensive is usually part of most full coverage plans, and is often required by lenders.

Most of the time, a standard full coverage car insurance plan includes the above components. However, every carrier is different in how they construct their plans and determine rates. As always, be sure to ask what’s included in your plan to avoid any confusion.

Additional Options:

Sometimes, there can be additional features to a full coverage plan, such as

Uninsured/Underinsured Motorist insurance pays for the medical expenses resulting from an accident involving your vehicle when it’s another person’s fault and that person doesn’t have adequate coverage. In some states this coverage is required. Certain states also offer uninsured motorist property damage coverage, which can cover damage to the vehicle as well. 

Personal injury protection, or PIP, pays for the medical expenses resulting from an accident where you are at fault. PIP goes beyond the standard liability coverage and covers medical expenses for both injured parties and their passengers, even if some have no health coverage. It can even cover funeral expenses. Some states require PIP. 

Consider this scenario…

You get into an accident involving someone else who is at fault. Your car is totaled from the incident, and you are injured bad enough that you need to take leave from work and have doctors and hospital bills mounting. Now consider if you have children and/or need help caring for them or taking care of your home because of your injuries. What if the person at fault is unable to cover these costs with their insurance or pocketbook? That leaves you footing the bill and possibly collecting more debt in attorney fees while you sue them for damages, pain, and suffering, assuming you decide to go that route. 

This sounds bleak, but it happens. With Uninsured motorist coverage your hospital bills and lost wages can be covered. PIP will go the extra mile and help cover these additional expenses, regardless of who is at fault. Remember, these are typically add-on features, so you might need to request these in addition to a standard full coverage policy. Although optional, adding on these features is the best way to ensure you receive optimal full coverage car insurance. 

Shopping for Cheap Full Coverage

All car insurance carriers offer full coverage plans, but rates are going to vary depending on a variety of factors and algorithms set forth by each company. The only way to ensure you get the best rate is to compare quotes with multiple carriers. Always ask about discounts, policy features, and add-ons available.

Consider Your Coverage Limits:

Aside from the different add-on features to consider when shopping for insurance, you should also consider your coverage limits. You don’t just have an accident and the insurance company swoops in and pays for all the damage. There is always fine print and limitations. 

Here is how it works in layperson’s: You file a claim, the insurance company investigates the claim, if they approve your claim, they will pay the expenses as high as your policy limit allows. Any amount that exceeds this limit or is not covered by your policy comes out of your pocket. Not understanding your limits is the biggest mistake you can make when buying insurance. 

Usually, each policy has separate limits for repairs and medical expenses, so it is important to understand each limit. Minimum liability limits are typically $100,000 for bodily injury per person, or $300,000 per accident, and $100,000 for property damage per accident. 

Keep in mind, higher limits equal higher coverage for accidents involving multiple vehicles and accident resulting in serious injuries or death.

Final Considerations

Now that you know more about full coverage auto insurance, you should be in a much better position to decide if it is the right kind of insurance coverage for you.

When shopping for full coverage insurance, the key thing to remember is to get multiple quotes. If you are comparing rates for full coverage, figure out what minimum limits you are comfortable with and make sure each policy offers the features you desire. Also, look for discounts with each carrier. You never know what the carrier might offer that fits your needs and can get you on the road quickly with the peace of mind you need.