What Is Full Coverage Auto Insurance?
"Full coverage" is a term that is commonly used in auto insurance. It is frequently used to describe a package that includes liability, collision, and comprehensive insurance. It may also include other options that you desire or require. Insurers' policies and coverage will differ by state. It is up to you to determine what you require.
Full coverage is the level at which you believe you can bear any financial burden for damage to your vehicle or the property of others. Learn more about your options so you can determine what you require to be completely covered.
What Is Full Coverage Insurance?
Full coverage is frequently a combination of coverages required by your state or needs. There is no such thing as a "full coverage" auto policy that will cover any and all damage to or with your vehicle. Be wary of any agent who claims to be able to do so.
Liability insurance covers your liability to the other driver or their passengers for bodily harm and property damage. Almost every state requires it.
Collision coverage applies to damage to your vehicle while it is being driven.
Comprehensive coverage compensates you for things that happen to your car that are not the result of a collision.
Every state in the United States has the authority to establish its own requirements. These frequently include bodily injury and property damage liability. Uninsured or underinsured motorists are also required to carry insurance in some states. Some people require medical payments insurance.
If you're financing your car, your lender may only require that you meet your state's minimum requirements, or it may also require collision and comprehensive coverage.
How Does Full Coverage Insurance Work?
Your coverage is determined by the policy you select. Other options may be available through your carrier.
Medical Payments and Personal Injury Protection
Medical payments and personal injury protection are provided at the state-mandated level. These contribute to the cost of care for you or others in your vehicle. It may also cover lost wages and other expenses resulting from the accident's injuries.
Uninsured or Underinsured Motorist Coverage
Some states require coverage to protect you if you are involved in an accident with an uninsured or underinsured driver, or if the other driver flees the scene. Their insurance, if they have it, may not cover all of their medical expenses. Check with your state to see what they expect.
Collision Insurance
Collision coverage pays for damage to your car if you are at fault in an accident, regardless of whether your vehicle collides with another vehicle or an object, such as a fence. It does not cover damage to another person's vehicle.
You will select your coverage limits as well as the amount you must pay as a deductible. These sums will have an impact on your premium. If you bought your car with a loan, your lender may require this coverage. Otherwise, it is frequently an option.
Comprehensive Insurance
Comprehensive coverage compensates you for damage to your vehicle that was not caused by a collision. This would include things like fire, theft, storm damage, animal damage, and falling objects. Comprehensive insurance covers damage to your car caused by events beyond your control.
Other Optional Coverage
Towing and car rentals may appear to be included with full coverage. However, this is not always the case. Discuss your options with your agent so that you are not caught off guard. You might be able to add a few options to your policy for very little money.
Gap Insurance
Loan or lease payoff insurance is another name for gap insurance. If you're taking out a loan for a large portion of the value of your vehicle, you should request it. If you owe more on your loan than your car is worth and have an accident or your car is stolen, you will have to pay for that "gap" out of pocket unless you have this coverage. Because car values depreciate quickly, this may be worthwhile.
Towing and Roadside Assistance
Roadside assistance is frequently bundled with full coverage. This frequently includes towing as well as services such as changing a flat tire or jumpstarting a dead battery.Â
Car Rental Coverage
When you purchase full coverage from some insurers, you may be eligible for a limited amount of car rental reimbursement. This coverage isn't always listed, so you'll have to inquire about it.
- You can usually select a certain amount of rental coverage per day, so make sure you select enough to cover a vehicle that meets your needs.
OEM Endorsement
Insurance companies do not always use parts directly from the car manufacturer, also known as the original equipment manufacturer (OEM). Instead, they may require less expensive or used parts for repairs. However, some insurers will provide a rider that allows you to obtain OEM parts if you request them.
Full Glass Coverage
Glass damage is covered by comprehensive coverage. When you select full coverage, it is automatically covered. However, if you choose a high deductible on your comprehensive plan, you may lose your glass coverage. You pay a higher premium in exchange for no deductible with full glass coverage, or at the very least a lower deductible for glass claims only.
Vanishing Deductibles
A vanishing deductible gives you a discount for every year you drive safely. It is not available from all insurers. This coverage is not always included with a full coverage policy. It is available at an additional cost. It must be added before a loss occurs.
Do I Need Full Coverage?
Certain coverages are mandated by law or by lenders. However, many of them are personal preferences.
If you don't have a lot of money saved up, it might be a good idea to protect yourself against a major liability in the event of an accident. In this case, you should purchase coverage that covers the majority of events and has a low deductible. However, keep in mind that you'll have to pay a high premium to get that coverage.
If you have a lot of money saved up, you might choose less coverage or higher deductibles so that you can cover a large portion of the cost of an accident. However, medical expenses from an accident can be far more expensive than purchasing a new vehicle. Your agent can assist you in weighing the risks and making a decision.