Full Coverage Auto Insurance vs. Liability Insurance

When you’re buying auto insurance, you may not be exactly sure what some coverages may cover. How much auto insurance do you need, and how can you make sure you’re not getting swindled into buying unnecessary and expensive coverages? We’ll explain the difference between full coverage and liability coverage, and which one is right for you.

• Comprehensive and collision: Collision and comprehensive coverage are optional in all states, but we recommend them. Collision coverage will cover damages to your vehicle in an at-fault accident, while comprehensive coverage covers damages from events other than collisions, such as theft, vandalism, and weather-related events like hail.
• Uninsured/underinsured motorist: Even in states where auto insurance is required, not everyone complies. If you get into an accident with a driver that lacks insurance or sufficient insurance, uninsured/underinsured motorist coverage will pay for your repairs. It also applies to hit-and-runs where you couldn’t get the other party’s insurance and contact information.
• Medical payments: Finally, in at-fault accidents, medical payments coverage (also known as personal injury protection) covers the cost of medical expenses and lost wages for you and your passengers.

Full coverage does not include every coverage available, however. It does not include:

• Roadside assistance
• Ridesharing (such as if you’re an Uber or Lyft driver)
• Rental car (when your vehicle is being repaired after an accident)
• Gap coverage
• Glass coverage
• Optional basic economic loss

Even so, you’re probably wondering how much full coverage auto insurance costs.

Of course, many factors affect the cost of car insurance, but on average, the annual cost of full coverage insurance in 2020 was $1,202.²

What Is Liability?

Liability includes only property damage and bodily injury coverage. It does not include collision, comprehensive, uninsured/underinsured motorist, or medical coverage.

Key Differences

• Comprehensive coverage
• Collision coverage
• Uninsured/underinsured motorist coverage
• Medical payments coverage
• Full coverage costs more than liability coverage

Key Similarities

• Property damage coverage
• Bodily injury coverage

Which Is Better?

It’s a good idea to get full coverage insurance so that you can get your damages and medical costs paid for in covered claims and so you can be reimbursed for accidents with uninsured motorists, theft, vandalism, and hail. Liability insurance on its own applies only to the other party’s property damage and injuries, so you are personally responsible for any costs beyond your policy’s limits.

Which Is Required by Law?

Full coverage isn’t required; just recommended. In most states, only liability coverage is required as a minimum amount. Some states require medical coverage, while others require uninsured motorist coverage. No state requires collision or comprehensive coverage.

To see what level of auto insurance your state requires, read our auto insurance guide.

However, you may pay more for car insurance if any of the following applies to you:

• Have a history of at-fault accidents, tickets, or license suspensions or revocations
• Have a short driving history or no driving history at all
• Have poor credit (not all states take this into consideration)
• Live in a city (rather than a rural or suburban area)
• Are under the age of 25
• Are male (men pay more for auto insurance than women in most states)
• Experienced a period of time in which you did not have insurance
• Drive an unsafe vehicle (like a vehicle with recalled parts) as determined by industry ratings
• Drive a lot of miles annually
• Have been convicted of DUI or have needed an SR-22