What Is Full Coverage Insurance? Here’s What It Consists Of


In 2017, Americans spent an average of $1,004.58 on auto insurance. While every state requires you to have insurance, the type and amounts can vary greatly.

However, no state requires you to purchase full coverage insurance. So why do insurance companies offer it? What is full coverage insurance? Why would you want it?

This guide will explain what full coverage insurance is and what it covers.

hat Is Full Coverage Insurance?

The term full coverage refers to car insurance that is a combination of coverages. It’s coverage that goes beyond what the basic requirements are. However, no insurance can protect you in every possible event.

Full coverage insurance does its best to cover you in the vast majority of possible situations.  Your insurance agent, such as Gessel & Associates Insurance Agency, can help you decide if full coverage is right for you.

What Does Full Coverage Car Insurance Cover?

Purchasing full coverage insurance typically means your policy includes comprehensive, liability, and collision coverage. Liability coverage protects you financially should you be at fault for the accident.

Comprehensive and collision protect you and your vehicle if you get into an accident or the vehicle incurs damage somehow. When purchasing this coverage, consider the maximum coverage amount and deductible. These amounts will directly affect the cost of your insurance premium.

Liability Insurance

Every state has a required minimum amount of liability insurance. You must purchase this to drive in that state legally. Once found responsible, your insurance will pay for the damages up to your limit total.

Collision Insurance

This is typically not a required coverage by your state. It applies when damage occurs while the vehicle is in motion. It could be your vehicle coming into contact with another vehicle or an object.

Most insurance companies will sell collisions and comprehensive as a package. This means you cannot buy one without the other.

Comprehensive Insurance

Having comprehensive coverage protects you if there’s physical damage to your vehicle when it’s not moving. Coverage will pay for the repair, and in the event of a total loss, it’ll pay for a replacement. This includes damage from hail, wind, falling objects, or theft.

This coverage is also applicable should you hit an animal while driving.

Rental Reimbursement

Some insurance companies will automatically include rental reimbursement in their full coverage policies. This coverage pays for a rental car that you can use while your vehicle is in the shop for repair.

This coverage is limited by a daily and total amount. This means you’ll have to choose a vehicle that fits within the daily limit and can only drive the vehicle until the total limit gets reached. Once you hit this limit, you’ll have to pay out of pocket.

Full Coverage Car Insurance Cost

What is full coverage insurance? This is a question you should no longer need an answer for. Now you need to decide if it’s worth purchasing for your vehicle.

Newer and high-value vehicles will warrant the additional cost of this additional coverage. Older and lower value cars may not be worth the additional coverage.

Check out our other car buying or maintenance articles for more tips and tricks to owning a vehicle.

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