UPDATED: Mar 13, 2020
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Some car owners have the habit of signing up for insurance just because the law requires it. Auto insurance, however, is more than just another nuisance that is required by the government. A good insurance policy can protect you in more ways than one. A full coverage insurance package, on the other hand, leaves little room for a lack of coverage and keeps you protected in most scenarios.
You may or may not know that at least some form of auto insurance coverage is mandatory in all 50 states. Each state in America requires that a person carries liability insurance that will pay for damage to third parties in the event of an accident.
Although only the minimum required insurance is needed, ideally, one should consider buying full coverage auto insurance as it can insure the person against heavy costs and expenses that might be incurred in the event of an accident. Before we get into the details about this type of auto insurance coverage, one has to understand that the term “full coverage” can actually be a bit misleading. Continue reading below to learn more about what full coverage insurance is, what type of coverage is included, why it’s important, which companies sell it, and how to get it.
What Is Full Coverage Car Insurance?
The meaning of the term “full coverage auto insurance” varies from company to company. There is no legal-standard for what constitutes “full coverage” in the United States. What means “full coverage” at one company, might not mean it at another company. One company, for example, might offer fire coverage in their full coverage policy, while another won’t. Therefore, it always makes sense to go through each individual policy with a fine-toothed comb to see what it actually covers. Don’t just take the insurance policy company’s word when they say it is full coverage insurance. There is always some scenario that your insurance company won’t cover.
Generally speaking, however, most full coverage policies include liability coverage, collision coverage, comprehensive coverage, and some form of uninsured motorist coverage. At the very least, it will include your state’s minimum insurance requirements, and then some. When you buy something advertised as “full coverage” from a reputable U.S. insurance provider, you can rest assured knowing that your coverage will be better than most.
What Coverage Is Usually Included In These Policies?
First party coverage – First party coverage will cover the damages to your own car in the event of an accident. Apart from covering repairs to your vehicle, it will also usually pay for a towing company to pick up your car after an accident or break-down. Some insurance policies might also pay the expenses for a rental car until your car comes back from the repair shop. In addition to covering these types of events, first party coverage will also cover damage from fire, hurricanes, floods, hail, and tornadoes. Theft will also be usually covered by first party coverage. Common types of first party coverage include collision coverage and comprehensive coverage.
Third party coverage – Third party coverage will pay for expenses related to bodily damage and property damage of a third party that might be involved in an accident. This includes paying for medical bills and car repairs of the other party, if you are ruled liable in an accident. Liability coverage, including property damage and bodily damage liability, are common types of third party coverage.
Why Full Coverage Is Important
If you ever are involved in a serious accident, you might be responsible for things such as medical expenses, property damage, repairs to your own vehicle, damages to another persons vehicle, etc. The things that you could be responsible for are endless. This is why some form of auto insurance coverage is required in all 50 states.
This minimum-required, bare-bones coverage, however, does not cover all situations and scenarios that could arise. Most states just require you to have a small amount of liability coverage. This coverage will only pay for damage you cause to the other party in an accident. It will not cover your own medical expenses, repairs to your vehicle, a replacement rental car, etc. This is why getting a “full coverage” policy that includes both first-party and third-party insurance types of liability, collision, comprehensive, and uninsured motorist coverage, is very important.
It sounds cliché, but you never know what could happen on the road. It’s always best to have as much coverage as possible so that you are insured in nearly all situations. Having a “full coverage” policy ensures this.
Is Full Coverage Required By Law?
As stated above, some form of liability coverage is required in every state. Most states, however, only require you to have a small amount of coverage. Full coverage, by any stretch of the word, is not required in any state. It is, however, highly recommended.
If you leased or financed you vehicle, the financing company will often times require you to purchase higher-than-usual insurance coverage. This is because they want to protect their asset (your vehicle). In this situation, buying “full coverage” insurance, or something close to it, will also protect you from owing the bank a large amount in case of an accident.
Who Has the Cheapest Full Coverage Auto Insurance?
If you want the cheapest car insurance, then you can buy a basic liability car insurance policy for just a few hundred dollars per year.
Generally, however, experts recommend buying full coverage auto insurance. Without full coverage auto insurance, you’re assuming a significant amount of risk.
Of course, just because you want full coverage car insurance doesn’t mean you want to pay a lot of money for it. Fortunately, drivers in every state have plenty of options when it comes to affordable full coverage auto insurance. Keep reading to discover who has the cheapest full coverage auto insurance in America.
Cheapest Full Coverage Car Insurance Companies in the United States
Certain companies in America are known for offering cheaper full coverage car insurance than other companies. One study from Value Penguin, for example, found the companies listed below offering the following full coverage car insurance prices to drivers in California per year:
- Nationwide: $1,137
- GEICO: $1,211
- State Farm: $1,453
- Allied: $1,633
- Progressive: $1,674
- Allstate: $1,728
- Esurance: $1,756
Generally, you can expect to pay twice as much for car insurance per year when going from a minimum liability plan to a full coverage plan. The average car insurance price in California, for example, is around $650 per year for a minimum liability plan and $1650 per year for a full coverage plan.
Check Full Coverage Car Insurance Prices at Smaller, Regional Companies
The car insurance providers listed above are all nationwide providers. Nationwide, GEICO, State Farm, Allied, Progressive, and Allstate are some of the largest car insurance companies in the United States. They’re known for offering competitive prices across the country, and all six companies offer premiums that are very competitive with one another.
However, sometimes your best option is to choose a smaller, regional provider. Some car insurance providers are only available in a certain state. Others are only available in a certain region – like the Midwest or the Northeast.
Drivers in California, for example, can get particularly low prices on full coverage car insurance from Century National. Drivers in Ohio can get cheap full coverage insurance from Erie Insurance or Grange Insurance. Sometimes, your best options are from smaller, regional providers.
Rates Vary Widely Across Drivers and States
Car insurance laws vary widely across the United States. Some states have high coverage requirements for car insurance. Other states have low coverage requirements. Some states require personal injury protection (PIP) coverage, while other states do not.
For all of these reasons, it’s crucial to do your own research: the cheapest full coverage auto insurance companies listed above might not be the cheapest options in your area. Your demographic data also matters. Your age, gender, and driving history has an enormous impact on your full coverage auto insurance options.
How To Get This Type Of Car Insurance Coverage
Like stated above, to get the cheapest car insurance packages, you will have to do some legwork. This will usually entail spending just a few hours of research. You can either do this over the phone or the internet. The internet is a much more efficient way to do it as it will save you a lot of time and effort. There are many sites online where you can enter your information in just a matter of minutes and then be presented with insurance quotes from several different companies instantly.
It is recommended that you shop around quite a bit as there are many companies that will offer competitive full coverage auto insurance quotes. The more you shop around, the better your chances are when it comes to finding the best rates available.
When shopping, you will usually be asked to provide information such as age, gender, your driving record, and some other details. You will also be asked to provide information about the car you are trying to insure. You will then have to select the amount of coverage you are looking for and also enter details such as the amount of deductible you are willing to pay.
Once these pieces of information are submitted, the quote provider will quickly present you with multiple quotes from various companies. Usually, you should not take these at face value and it is always a good idea to read through their fine print to make sure that there are no hidden charges lurking in the contract. Nevertheless, by comparing quotes today, you can be sure to find competitive full coverage auto insurance based on your location and demographic information.