Insurance companies often use the term full coverage insurance to describe a package that includes comprehensive and collision policies. While full coverage does not include bodily injury and property damage liability, drivers must also have state-minimum liability coverage to cover the cost of an at-fault accident.
Collision Insurance
This component of full coverage auto insurance pays to fix your car if you sustain collision-related damage. You can file a claim with your collision policy even if you caused the crash. Common types of collision claims include rollover accidents, hit and run accidents, accidents in which one driver rear-ends another, and incidents in which the driver hits a fence, building, or other object.
When you file a claim with your collision policy, you have to pay a deductible. You select the amount of the out-of-pocket deductible when you purchase your auto insurance policy, commonly $500 or $1000.
Comprehensive Insurance
This aspect of full coverage insurance covers damage to your car that occurs in non-collision incidents, such as collision with an animal, extreme weather, vandalism, or theft. As with a collision policy, a comprehensive auto policy requires a deductible if you file a claim. However, drivers usually experience only a minimal premium increase of about $66 per year after filing a comprehensive claim according to auto insurance website Value Penguin.
Cost of Full Coverage
The Zebra found these average six-month costs by insurance company for full coverage insurance:
- Nationwide - $541 compared to $235 for liability only
- GEICO - $562 compared to $285 for liability only
- Progressive - $627 compared to $298 for liability only
- USAA - $636 compared to $259 for liability only
- State Farm - $646 compared to $296 for liability only
- Travelers Insurance - $684 compared to $309 for liability only
- American Family - $700 compared to $331 for liability only
- Farmers Insurance - $788 compared to $319 for liability only
- Liberty Mutual - $863 compared to $356 for liability only
- Allstate - $1019 compared to $430 for liability only
Nerd Wallet reports that the average 40-year-old driver with a good credit history and no prior accidents or tickets pays about $1592 for an annual full coverage auto insurance policy.
In Value Penguin's study, a full coverage auto insurance policy cost $200 per month or $2399 per year on average, about 200% of the premium cost for minimum liability coverage alone. The website reports that State Farm offers the cheapest coverage at $145 per month or $1738 per year on average.
In most states, drivers who have poor credit pay more for auto insurance. Insurers use a specific type of credit score that looks at your debt level and payment history. They also check your driving history with the Department of Motor Vehicles. According to Nerd Wallet, drivers pay an average of $2439 per year for full coverage insurance after an at-fault accident, $2812 with a good driving history but poor credit, and $3114 with an arrest for driving under the influence.
Best Full Coverage Insurance Companies
Value Penguin recommends Geico as the best full coverage insurance company that writes policies throughout the United States. The website names USAA as the best full coverage option for military families and Erie as the best full coverage insurer option for drivers who live in the Northeastern or Midwestern states where the firm writes auto policies.
Other Types of Coverage
You can customize your full coverage auto insurance by adding other types of coverage as needed for your personal situation. Common examples include:
- Personal injury protection, which pays your medical bills after an accident
- Uninsured motorist coverage, which pays your expenses if you get hit by an uninsured motorist or experience a hit-and-run accident
- Underinsured motorist coverage, which pays the extra expenses after an accident with a driver who has only limited insurance
- Medical payments coverage, sometimes called med pay, which pays medical expenses for you and your passengers if you experience auto accident injuries
- Towing and labor coverage, which pays the cost of roadside assistance and towing if your car breaks down
- Rental car coverage, which pays for a temporarily replacement when your car needs repairs
- Gap insurance, which pays off your auto loan if you total your car and owe more than its value
- Custom policies that cover modifications made to a vehicle
Deciding on Full Coverage Insurance
Most states only require drivers to carry limited liability insurance. While you do not have to have full coverage by law, The Zebra notes that it does prevent you from a large out-of-pocket loss if a crash occurs.
If you have an older car, consider the cost of full coverage and the value of your vehicle when deciding whether it makes sense to purchase this policy. Let's look at an example. If you pay $500 per year for your full coverage insurance with a $1000 deductible and you have a car worth $3000, you would only receive a check for $1500 if you totaled your vehicle.
When purchasing full coverage, shopping around with different carriers can help you find the most affordable rates. Nerd Wallet recommends using the same liability limits and deductible amounts when you get each quote to make a fair comparison. When you select your deductible, make sure you can afford to pay that amount out-of-pocket if you have an accident.
You should also closely compare the fine print about add-on policies like coverage for pet injuries, accident forgiveness, and gap insurance. The cost, terms, and conditions can significantly vary from one insurance company to the next. It may go without saying, but make sure you enter the same driver, car, and address information when you obtain each quote.
According to Nerd Wallet, the average driver can save about $1000 per year by choosing the lowest available auto insurance quote compared to the highest available auto insurance quote, assuming you got quotes from the nation's six largest auto insurance companies.
Check this out if you need additional information, resources, or guidance on car insurance.
Sources:
The Cheapest (and Best) Full Coverage Car Insurance
Car Insurance
How to find the best cheap full coverage car insurance for you
The Cheapest, Best Full Coverage Car Insurance
Adding a Car to Insurance: Everything You Need to Know
Hearst Autos Research
Hearst Autos Research, produced independently of the Car and Driver Editorial staff, provides articles about cars and the automotive industry to help readers make informed purchasing choices.
