Jessica Sautter is a Content Writer for with a Bachelor’s Degree from Eastern Michigan University in Elementary Education with a Major in Reading and a Minor in Mathematics.

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Chris Harrigan has an economic degree from Limestone College and an MBA from Clemson University. He previously managed auto insurance claims for Enterprise Rent-A-Car. Currently, he is using his business and insurance expertise to provide insurance data analysis and visualizations to enhance the user experience.

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Reviewed by Chris Harrigan
Former Auto Insurance Claims Manager

UPDATED: Oct 18, 2020

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Key takeaways...

  • In reality, there isn’t a policy called full coverage, although there are options to ensure you are “fully covered” in any possible scenario
  • Full coverage can include medical policies, uninsured/underinsured motorist incidents, collision, comprehensive, rental cars, and towing services
  • Keep in mind though that certain situations won’t qualify for coverage and that there may be exclusions

If you’ve never taken the time to understand your auto insurance policy, then it can seem a little overwhelming and a bit confusing when you finally do.

There are so many different parts of the policy, and they all seem to do different things.

So what exactly is full coverage car insurance? What does it cover? Is there anything it won’t cover? Read on for more information.

If you want to ensure your car is fully covered, enter your ZIP code above and compare at least three to four policies today!


When some people speak of full coverage car insurance, they are referring to insurance that will cover them in every circumstance.

While in reality there isn’t a policy called full coverage, there are ways to make sure that you are covered for as many circumstances as possible.

A good example is setting your liability coverage at the right levels. Liability is actually two different types of insurance.

One is bodily injury liability, which pays for medical expenses the other driver and his passengers might have from an accident you cause. The second is property liability, which pays to repair the other driver’s car.

Liability is usually described using three numbers, such as 10/20/10. The first two numbers tell you how much bodily injury money your policy will pay out.

In this instance, it’s $10,000 per person in the car, with a maximum of $20,000 per accident. The last number is the property liability, also $10,000.

Each state sets the minimum amount of these three that you must carry in order to be driving legally. If you have this minimum amount, you may think you have this part of car insurance covered.

But if you talk to a financial advisor or an insurance expert, you’ll probably find that they recommend a much higher amount than the state minimums for coverage.

The problem is that the states’ minimum levels are all fairly low. Let’s say you’re involved in a worst-case scenario traffic accident, in which you hit a minivan full of kids. Several people are critically injured.

With several people hurt, how long do you think $30,000 is going to last? Even if that family racks up $100,000 in bills, your insurance company will only pay $30,000.

California also only requires $5,000 in property liability. If that minivan is totaled and was worth $15,000, your insurance will only pay $5,000, and you’ll be on the hook for the remaining $10,000.

If you only carry the minimums and find yourself in an accident scenario like this, you are going to see yourself involved in a lawsuit. Legally, you are responsible for paying for those damages, even if you’ve exhausted your insurance.

Many people have lost savings and retirement accounts and had to sell their homes, to pay for judgments in court because they didn’t have enough liability insurance.

Not having enough coverage is why experts, including those at the Insurance Information Institute, recommend carrying at least 100/300/50 liability.

Also, if you have a lot of assets, you should also look into an umbrella liability policy. These policies are relatively inexpensive, usually about $200 a year for the first $1 million.

Umbrella policies act as secondary policies that kick in after your home or auto liability insurance policies have reached their maximum.

So, if you want full coverage car insurance, make sure you are carrying enough liability insurance to cover your net worth.

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Medical Policies

Most of the time, people with full coverage car insurance have some medical coverage on their policy. Some states even require that you have some.

There are two different kinds. If your state requires medical coverage, it will specify which to have. If it doesn’t, you can choose between the two.

Medical payments coverage pays up a certain amount for medical expenses per person in your car, no matter whether they are related to you or not.

Personal injury protection (PIP) also pays up to a specific dollar amount, which you set when you buy it, per person in your car.

Both policies will pay regardless of who caused the accident.

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PIP pays for more than just medical bills. It will also pay you for any work you might have missed because of the accident or recovery. It will even pay for services you can’t do for yourself, like housecleaning or yard work, while you recover. It will also pay for funeral expenses.

Without either PIP or med-pay on your policy, it really isn’t full coverage, as there won’t be any provision to pay for your medical expenses or those of your passengers.

However, some people are already covered by health insurance and life insurance and feel that these are duplicate policies, so they choose not to carry PIP or med pay. However, if you tell an insurance agent you want full coverage, they’ll give you one of these.

Uninsured/Underinsured Motorist

One circumstance no one wants to face is being hit by another driver who doesn’t have any insurance. Though they are legally responsible for paying, it can take a long time to get anything from someone who can’t even afford auto insurance, if you ever do.

That’s why car insurance companies offer uninsured motorist coverage; in fact, some states require that you have uninsured motorist insurance in addition to liability.

Uninsured motorist insurance covers your repairs or will replace your car and will pay for your medical expenses if the other driver who is at fault has no insurance, according to the Rocky Mountain Insurance Information Association.

It will also cover any gaps between what their insurance will pay for and your actual damages, which is why it’s sometimes called underinsured motorist protection.

If you are hit in California by a driver with only $5,000 in property liability, but you have $20,000 in damage, then your UM/UIM coverage will pay the $15,000 difference until the courts can get it from her.

The nice thing about UM/UIM is that a claim to this usually will not cause your rates to go up. You can also make this claim through your collision coverage, but any claim to that will almost always result in a premium increase.

Comprehensive and Collision

When most people speak of full coverage car insurance, they are referring to the fact that you have comprehensive and collision coverage on your policy.

These two coverages, separate but almost always sold together, are what pay for damages to your car.

Collision coverage pays for your repairs if you are the at-fault party in an accident. If the cost of the damage is too close to the value of the car, it will be considered totaled. At that point, you will be given the actual cash value of the car, minus your deductible.

Comprehensive doesn’t mean it covers everything like the name implies, though it does cover quite a bit. Comprehensive is the part of the insurance policy that pays for your repairs, or for the car to be replaced if it is damaged in some way besides a wreck.

Comprehensive pays for the car if:

  • It has hail dings
  • A tree falls on the roof
  • It is damaged in a fire
  • The car is stolen

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Rental Cars and Towing

Most car companies offer a few extras, like rental cars and a towing package. These deals are usually not part of a full coverage car insurance policy, but anyone can add them if you feel like you need it.

The rental car coverage will pay for a rental car for you to drive while your car is in the shop following an accident you cause. If the other driver is at fault, his liability will cover the rental.

Many people choose to do without rental car coverage since most families these days have a second or even third vehicle that can be used if the primary vehicle ends up in the shop.

Towing coverage will cover the cost of a tow truck to take your car to a body repair or mechanic’s shop, whether you have had an accident or a breakdown.

If you already have this coverage under your car’s warranty or a car club membership, Consumer Reports advises you to skip this coverage. If not, you should consider whether the cost of the coverage is worth it compared to the cost of tow trucks in your area.

What It Won’t Cover

If you have the right amount of liability, medical coverage, uninsured/underinsured motorist, comprehensive, and collision, there’s not a whole lot your policy won’t cover. There are a few things to keep in mind though.

Most policies have a few exclusions on them. If you commit a felony in your car, your insurance will not cover any accidents which occurred at that time.

It will also not usually cover any use of the car for business purposes other than commuting. If you are asked to use your personal car for such things, ask your employer if they have insurance to cover you since yours might not.

Many people wonder if they can borrow a car or if they can lend one of theirs to a friend and still be covered. The answer is usually yes, though ask your agent to be sure.

And most policies will also cover a rental car, so you can decline the insurance policies offered at the rental car counters. Again, ask before you leave on your trip to be sure.

If you have a driver in your household that you have failed to put on your policy, your insurance can refuse to cover any damages they might cause.

Some parents of teens have tried to leave their teens off the policy, saying they are just lending the car to them. However, most policies explicitly say they won’t cover circumstances like this.

If you want your car covered in any situation, start comparison shopping today for better and more affordable auto insurance by entering your ZIP code below!