Full coverage car insurance isn't a specific policy but a common term for a combination of coverages that provide extensive protection. It typically includes liability, comprehensive, and collision insurance. This bundle is often required if you lease or finance your car, as it protects the lender's financial interest in the vehicle.
The core components are:
- Liability Insurance: Covers costs for injuries and property damage you cause to others in an at-fault accident. This is legally required in most states.
- Collision Insurance: Pays for repairs to your own car after an accident, regardless of who is at fault.
- Comprehensive Insurance: Covers damage to your car from non-collision events like theft, vandalism, fire, or natural disasters.
While not technically "full," this combination leaves few gaps. Many people add optional coverages like uninsured/underinsured motorist protection, which covers your expenses if you're hit by a driver with little or no insurance, and medical payments or personal injury protection (PIP).
The cost of full coverage varies significantly based on your driving record, location, vehicle type, and deductible—the amount you pay out-of-pocket before insurance kicks in. Choosing a higher deductible usually lowers your premium but increases your immediate cost if you file a claim.
| Factor | Impact on Premium (Average Annual U.S. Cost) | Common Deductible Choices |
|---|
| Driving Record (Clean vs. With Accident) | $1,674 vs. $2,587 (Increase of ~55%) | N/A |
| State Regulations (Michigan vs. Maine) | $2,541 vs. $1,006 (Varies by over 150%) | N/A |
| Vehicle Type (SUV vs. Sedan) | Varies by model; luxury/sports cars cost more | $500, $1,000 |
| Comprehensive/Collision Deductible | Choosing $1,000 vs. $500 can save 10-15% | $250, $500, $1,000 |
| Age of Driver (Under 25) | Can be double the premium for a 40-year-old | N/A |
| Credit-Based Insurance Score | Poor score can increase premium by 50-100%+ | N/A |
Ultimately, "full coverage" is about balancing risk and budget. It's essential for new or expensive cars but may not be cost-effective for older vehicles with low market values.
