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What Is Full Coverage Auto Insurance?

Full coverage auto insurance is an industry term—not an actual policy type—that typically refers to a combination of liability, collision, and comprehensive coverage that protects both damage you cause to others and damage to your own vehicle.

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What Is Full Coverage Insurance?

Full coverage combines three core types: liability insurance (pays for injuries and property damage you cause to others), collision coverage (pays for damage to your vehicle from accidents regardless of fault), and comprehensive coverage (pays for non-collision damage like theft, vandalism, weather, or hitting an animal). Most lenders and lessors require this package to protect their financial interest in your financed vehicle. The term 'full coverage' is actually a misnomer—no policy covers absolutely everything, and you'll still have deductibles, coverage limits, and specific exclusions to navigate.

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Who Needs Full Coverage Insurance?

You need full coverage if you're financing or leasing a vehicle—lenders universally require it to protect their collateral, and violating this requirement can trigger forced-place insurance at two to three times your normal premium.

Use this test: multiply your car's current market value (check Kelley Blue Book or similar) by 0.10, then compare that to your annual collision and comprehensive premium plus your deductible. For drivers with violations, also consider your ability to absorb a total loss—if losing the car means losing your job or your ability to meet SR-22 requirements, the peace of mind may justify the cost even on an older vehicle.

Related Coverage Types

Driver's-eye view from inside a car at night, with two hands gripping the steering wheel, an illuminated instrument cluster behind it, and a road with blurred street lights and oncoming headlights through the windshield.

SR-22 Insurance→

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Non-Standard Auto Insurance→

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Liability Insurance→

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Uninsured Motorist Coverage→

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