State Minimum vs. Full Coverage Car Insurance: What You Need to Know
At Compare.com, it’s our mission to find simple ways to help our customers save money on the things they need. While we partner with some of the companies and brands we talk about in our articles, all of our content is written and reviewed by our independent editorial team and never influenced by our partnerships. Learn about how we make money, review our editorial standards, and reference our data methodology to learn more about why you can trust Compare.com.
You hear the term ‘full coverage auto insurance’ thrown around often. It sure sounds good, but it also sounds expensive. Do you really need full coverage, or can you get away with the state minimum? We’ll walk you through the details, and you can decide which choice is best for you.
Full Coverage Car Insurance
First, let’s get something straight. ‘Full coverage car insurance’ isn’t technically a type of insurance. Generally, it means car insurance that offers enough coverage to protect you and your vehicle in almost every scenario, whether a parking lot fender-bender or a total write-off.
Full coverage car insurance usually includes a few of the below coverages (depending on your state):
- Bodily Injury Liability: This covers other people’s medical bills if they’re injured in an accident you caused
- Property Damage: Similar to bodily injury, but this time for the property. If you back into someone else’s car, this will pay to fix their dent.
- Collision Coverage: If you hit another car or object (for example, a tree), this coverage fixes your vehicle
- Comprehensive: Bad storm wreck your vehicle? Car stolen? Flood? Comprehensive will save the day.
- Medical Payments: Pretty obvious, it covers your medical bills
- Personal Injury Protection: Differs depending on the state but generally covers medical bills and lost wages
- Uninsured or Underinsured Motorist: If someone hits you who has no insurance or whose coverage isn’t enough to cover the bills, this will kick in to make up the difference
- Roadside Assistance, Towing, and Rental Car: This brings your knight in shining armor to you at the side of the road, tows your car to a garage, and then gives you a rental until it’s fixed
That’s a lot of coverage. Having this full coverage provides peace of mind and financial protection. Of course, the more coverage you get, the higher your premium. If you don’t do your research, you may end up paying hundreds for coverage you never use.
Think about the age of your car, what your health insurance covers, and weigh up what you really need. If you have a new car, your manufacturer may have already thrown in a couple of years of roadside assistance. If you’re currently unemployed, you may not need the work loss payments. These are all things to consider when adding up your package.
State Minimum Car Insurance
State minimum car insurance means a policy that meets the state coverage requirements for you to drive legally. It differs by state, but it usually falls around the $15,000/$30,000 mark. State minimum coverage typically includes:
- Bodily Injury Liability
- Property Damage Liability
And that’s it. Depending on which state you’re getting insured in, some may also include personal injury protection or uninsured motorist coverage. If you’re in Florida, you don’t even require bodily injury liability, so you really are going the bare minimum.
Compare Coverage Levels, Side by Side, from Multiple Companies
What is the most obvious benefit of going for the minimum insurance required by your state? It’s the cheapest option. Many insurance companies specialize in offering the state minimum. They keep their prices low and give you just enough to be legal on the roads.
Check out rate comparisons from some of our busiest U.S. states below:
|State||State Minimum Annual Premium||Full Coverage Annual Premium|
Buying the state minimum insurance is also a lot better than the alternative: driving uninsured. Every state except for New Hampshire requires drivers to carry liability insurance, and there are stiff penalties if you’re caught driving without it. You don’t have to be pulled over to have your insurance status checked. Several states use electronic insurance verification, in which insurance records are checked against motor vehicle registrations.
However, insurance experts warn that having the state minimum car insurance won’t protect you sufficiently in case of an accident. According to the Insurance Information Institute the average claim cost in 2016 was:
- Bodily Injury Liability: $16,110
- Property Damage Liability: $3,683
- Comprehensive: $3,435
- Collision: $1,748
Remember that these numbers each represent the amount filed for a single claim. In one accident, multiple claims may be filed for damage to the vehicles and injuries to each passenger. Remember: these numbers also are averages. If you hit a brand new Mercedes-Benz or a 7-seater full of injured passengers, you can expect those numbers to shoot up pretty quickly.
If you do cause an accident that injures multiple people or cars, you may find yourself responsible for paying several thousands of dollars. Don’t think you can simply turn out your pockets and say, “I can’t pay.” The other party can sue you for damages and force you to sell your assets to pay the debt.
Finally, state minimum car insurance is designed to help whoever you damage. It does not include collision or comprehensive coverage, which both cover your car. If your car is stolen, hits a deer, chips a windshield, or is totaled: you’re on your own.
State Minimum or Full Coverage Car Insurance?
You want to ensure you’re protected, but you don’t have money to waste on extra insurance. How do you know if the state minimum coverage will be enough?
First, check your state’s minimum liability requirements. These vary quite a lot between states and also may change over time. The requirements appear in a format like this: 25/50/25, which means bodily injury coverage up to $25,000 per person in an accident and $50,000 for all injured, and $25,000 for property damage.
As of 2018, Florida has the lowest standard insurance requirements: $0 bodily injury liability and $10,000 property damage liability. New Jersey’s basic plan for young or low-asset drivers (a step below state minimum) goes even lower: $0 bodily injury liability and just $5,000 property damage liability. That won’t go very far if you get into an accident.
On the other end of the spectrum, Alaska and Maine have the highest minimum insurance requirements: 50/100/25. When you’re looking at what’s right for you, this may still not be enough.
Once you’ve checked your state insurance requirements, determine your worth. Add up the value of your home (if you own it), your bank accounts, and any other assets. If you don’t own much besides your 5th-hand car and a Chipotle gift card, the state minimum insurance may be enough for you because you don’t have significant assets to protect. Depending on how much is on that gift card.
Ultimately, the best way to decide is to compare car insurance quotes. Compare.com lets you get free quotes from multiple insurers for different coverage levels, so you can see how much more you’ll pay for full coverage car insurance.
You might be surprised to find that you can increase your coverage without paying much more. For instance, the Virginia state minimum requirements are 30/60/30. When we looked at state minimum quotes for a single driver with a 10-year-old car and a good driving record, one insurance quote bumped that coverage up to 100/300/100 for just $60 more per year.
Compare Car Insurance Quotes
Compare.com’s #1 goal is to save you money. We publish resources that are based on hard-hitting data and years of industry experience to help you make more informed decisions with your wallet.
- All of Compare.com’s content is written and reviewed for accuracy by a team of experienced writers and editors who are experts on the topics they cover.
- None of Compare.com’s content is ever influenced by the companies and brands we partner with.
- Compare.com’s editorial team operates independently of any of the company’s partnership or business development interests. We publish unbiased information strictly for the benefit of our readers.
- All of the content you see on Compare.com is based on comprehensive analysis and all data is gathered and vetted from trustworthy sources.
Learn more about us, our team, and what makes us tick.