Full Coverage vs. Liability Only: What Do You Really Need?

Stop Paying for Coverage You Don't Need

When buying auto insurance, the biggest decision is whether to get "full coverage" or stick with liability only. Making the wrong choice can cost you thousands of dollars over the lifespan of your vehicle.

What is Liability Insurance?

Liability insurance is required by law in almost every state. It covers the damage you cause to other people and their property in an accident where you are at fault. It does NOT pay to fix your own car.

What is Full Coverage?

Full coverage isn't actually a single type of insurance; it is a combination of Liability, Collision, and Comprehensive. If you have an auto loan or a lease, your lender will force you to carry full coverage.

When to Drop Full Coverage

If your car is completely paid off, and its actual cash value is less than $4,000, you should strongly consider dropping collision and comprehensive coverage. Take that extra money you save on premiums and put it into an emergency savings account.