+120 more)
Amy Beardsley is a seasoned insurance expert who’s been writing for Compare.com since 2023. She has more than 12 years of industry knowledge and expertise in auto, home, life, commercial, and other insurance products. Amy’s work has been published by Berkshire Hathaway Specialty Insurance, Legal & General, NerdWallet, Robinhood, Insurify, NEXT Insurance, and more.
Amy worked as a court administrator before becoming a content marketing writer. Her legal background has equipped her with the ability to simplify complex technical language into easy-to-understand content.
She graduated magna cum laude from Ferris State University, where she earned a Bachelor of Science in Business Administration and Legal Studies.
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Lequita Westbrooks is an insurance editor at Compare.com. Her writing and editing experiences span several industries, including insurance, personal finance, higher education, and more. She excels at explaining complex topics like auto insurance in simple, easy-to-understand language and is passionate about helping readers save money. Lequita graduated from the University of South Florida, where she earned her Bachelor’s degree in English.
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The debate between liability insurance vs. full coverage is common among car owners. Liability insurance helps pay for damages you cause to others in an accident, but it won’t pay to repair your vehicle. Full coverage includes liability plus collision and comprehensive coverage to protect your car.
When comparing auto insurance, the right choice depends on your budget, risk tolerance, and vehicle’s value. This article will break down the differences between these coverages to help you decide on the best and cheapest auto policy.
The national average monthly premium for liability-only coverage is $101, while full coverage costs $175.
Most U.S. states require liability insurance, but lenders often require full coverage for financed or leased cars.
Your state’s minimum liability limits won’t cover your injuries or damage to your vehicle.
Factor  | Liability Insurance | Full-Coverage Insurance |
|---|---|---|
| Covers | Damages and injuries you cause to others | Damages and injuries you cause to others + your vehicle |
| Doesn’t cover | Your car or medical bills | Your medical bills |
| Average costs | $101 | $175 |
| Requirements | Every state except New Hampshire | Financed or leased vehicles |
| Best for | Drivers with older cars or ones who’ve paid off their vehicles and want to save money | Drivers with new, financed, or leased vehicles who want maximum protection |
Liability insurance includes bodily injury and property damage liability coverage. That means it helps pay for the other person’s medical bills and damage to their property when you’re at fault in an accident. But it doesn’t cover your injuries or damages to your car.
Every state except New Hampshire requires drivers to have liability insurance.[1] Just know that each state has laws that spell out the minimum amount of coverage you must have to legally operate a vehicle on the road, so it’s important to know exactly how much your state requires.
A full-coverage policy usually includes liability, as well as collision and comprehensive insurance. Collision coverage pays for your car repairs, and comprehensive coverage picks up the tab for non-collision incidents, such as hitting an animal, theft, and weather damage like hail. But it won’t pay for routine maintenance or mechanical failures.
Lenders and leasing companies usually require you to have this coverage for the entirety of your lease or loan. Keep in mind that what constitutes “full coverage” varies by insurance company and state. Some companies offer extras like rental car coverage and roadside assistance, while others don’t.
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Deciding between a liability and a full-coverage policy can be challenging, but the right choice depends on factors like your budget and your car’s value. Liability insurance offers basic coverage at a lower cost, while full coverage costs more because it provides more coverage.
To help you choose between the coverages, we’ll break down the pros and cons of each coverage and when they make sense.
Compare the best liability and full-coverage rates head-to-head.
Basic liability coverage isn’t for everyone. Although a liability-only policy at your state-minimum limits is the cheapest policy available, it puts you at greater financial risk. Still, a liability-only policy might be worth considering in situations such as the following:
You’re on a tight budget and looking for low-cost coverage.
Your car is older or has lost its value, so the cost of full coverage isn’t worth the benefits.
You have a car you rarely drive or use as a secondary vehicle.
You can afford to pay for your vehicle damage out of pocket.
That said, evaluating your situation before going with a liability-only policy is always important. Keep in mind that you can buy higher liability limits than your state requires and still have a liability-only policy.
Let’s look at some pros and cons of liability insurance and when to consider a liability-only policy.
One of the cheapest auto insurance coverages
Meets minimum car insurance requirements
No deductible if you file a liability claim
Doesn’t cover your vehicle or medical bills
Doesn’t protect against theft of your car
Lower policy limits may not cover all damages
Most drivers should at least consider a full-coverage policy. Nearly 80% of drivers choose full coverage over liability-only insurance, according to the Insurance Information Institute (Triple-I).[2]
A full-coverage policy may make sense in the following situations:
You lease or finance your car.
You have a newer car that still holds a lot of value, even if you’ve paid it off.
You live in an area with high traffic, extreme weather, or high theft rates.
You rely heavily on your car for daily activities.
You can’t afford to pay out of pocket to replace or repair your car after an accident.
Here are some pros and cons of full-coverage insurance and when to consider this type of policy.
Covers accidents, theft, and natural disasters
Pays for your vehicle repairs or replacement
Meets lender or lease requirements
Costs more than liability insurance
Not always cost-effective for older cars
Requires a deductible when filing a claim
Full coverage doesn’t have to be a lifelong commitment. Dropping it may make sense if you pay off your car loan when your car reaches a certain age or if you rarely drive it.
Keep in mind that having liability-only coverage isn’t a decision to take lightly. Before making changes to your insurance policy, weigh the pros and cons beyond the immediate benefit of a reduced rate.
Deciding between a liability and aor full-coverage policy is an important decision that can seriously affect your finances. Before you choose, you should weigh several factors, including the ones we highlighted below.
Most states require you to purchase a minimum amount of auto insurance coverage. But you may need full coverage if you have a car loan or lease. Check your state’s car insurance laws and financing agreement to make sure you have the right protection.
Liability-only insurance can cost a lot less than full coverage. And if you’re on a tight budget, liability insurance may be the only affordable option. But the added protection of full coverage can be worth it in many situations if you can afford the higher payment.
Risk tolerance describes your comfort level with paying out of pocket for car repairs or a replacement. If you have a high risk tolerance, you might be fine with liability-only insurance and paying potential repair costs after an accident. But if you have a low risk tolerance, you might prefer the added protection of full coverage.
A car worth a few thousand dollars might not be worth the cost of purchasing full coverage. But purchasing full coverage is usually a smart financial move for high-value vehicles or if you’d struggle to repair or replace your car after an accident.
Choosing between liability-only or full coverage is just the beginning. You must also decide on coverage limits — the maximum amount your insurer will pay when you file a claim. States set minimum liability limits, but these limits only offer minimum coverage. Higher limits provide more financial protection but come at a higher cost.
It’s wise to buy more than the state minimum, according to Triple-I. That’s because you’re on the hook for the difference if you file a claim that exceeds your policy limit. Adding more protection to cover these costs is also recommended by the National Association of Auto Insurance Commissioners (NAIC).[3]
Liability insurance tends to be significantly cheaper than full coverage, so having this policy alone can help you save on your car insurance costs. But keep in mind that rates vary by many factors, including your address, age, vehicle, and driving record.
The chart below highlights the average monthly premiums for liability coverage vs. full-coverage car insurance, according to Compare.com data.
Coverage Level | Average Monthly Premium |
|---|---|
| Liability only | $101 |
| Full coverage | $175 |
Full coverage costs nearly twice as much as liability-only insurance, on average, but your exact rate depends on many factors, such as your state, age, driving record, and insurance company.
Next, let’s explore average auto insurance rates by state.
Where you live affects car insurance premiums because rates vary greatly by state due to differing minimum insurance requirements, laws, and local risk factors. States with more accidents and severe weather events tend to have higher premiums. On the other hand, rural states often have fewer claims and lower repair costs.
The map below shows each state’s average monthly liability and full-coverage premiums and the price difference between the two.
State | Average Liability Premium | Average Full-Coverage Premium |
|---|---|---|
| Alabama | $66 | $129 |
| Alaska | $86 | $119 |
| Arizona | $94 | $156 |
| Arkansas | $82 | $154 |
| California | $93 | $194 |
| Colorado | $94 | $193 |
| Connecticut | $171 | $249 |
| Delaware | $158 | $231 |
| Florida | $153 | $202 |
| Georgia | $161 | $245 |
| Hawaii | $59 | $111 |
| Idaho | $63 | $100 |
| Illinois | $80 | $147 |
| Indiana | $68 | $127 |
| Iowa | $53 | $100 |
| Kansas | $77 | $145 |
| Kentucky | $116 | $184 |
| Louisiana | $105 | $188 |
| Maine | $81 | $143 |
| Maryland | $188 | $274 |
| Massachusetts | $105 | $145 |
| Michigan | $137 | $208 |
| Minnesota | $90 | $161 |
| Mississippi | $67 | $134 |
| Missouri | $91 | $171 |
| Montana | $65 | $136 |
| Nebraska | $71 | $132 |
| Nevada | $157 | $235 |
| New Hampshire | $54 | $85 |
| New Jersey | $176 | $260 |
| New Mexico | $68 | $132 |
| New York | $165 | $183 |
| North Carolina | $65 | $91 |
| North Dakota | $67 | $114 |
| Ohio | $70 | $118 |
| Oklahoma | $84 | $163 |
| Oregon | $91 | $139 |
| Pennsylvania | $92 | $148 |
| Rhode Island | $148 | $209 |
| South Carolina | $163 | $231 |
| South Dakota | $60 | $134 |
| Tennessee | $67 | $131 |
| Texas | $121 | $209 |
| Utah | $98 | $143 |
| Vermont | $62 | $134 |
| Virginia | $111 | $176 |
| Washington | $94 | $163 |
| Washington D.C. | $213 | $297 |
| West Virginia | $82 | $145 |
| Wisconsin | $59 | $112 |
| Wyoming | $55 | $99 |
Age can significantly affect auto insurance premiums, with young drivers often paying the highest rates. Teens have the highest premiums for full coverage and liability-only insurance because insurers consider young drivers as high-risk — car accidents are the leading cause of death for 15 to 18-year-olds.[4]
But rates drop as you reach yourtheir 20s and beyond — and drivers in their 50s and 60s have the lowest premiums.
Check out the table below to see the average monthly premiums for both coverages for different age groups.
Age Group | Average Liability Premium | Average Full-Coverage Premium |
|---|---|---|
| Teens | $195 | $338 |
| Adults | $104 | $180 |
| Seniors | $86 | $149 |
Car insurance companies look at your driving record to gauge how risky you are behind the wheel. Drivers with clean records get some of the best rates. But if you get a ticket or accident on your record, insurers charge you higher premiums. Some incidents are riskier than others — the higher the risk, the more you’ll pay.
The data in the chart below shows how different driving incidents can affect monthly insurance premiums and the differences between both rates.
Driving Record | Average Liability Premium | Average Full-Coverage Premium |
|---|---|---|
| Clean record | $101 | $175 |
| Recent ticket | $128 | $222 |
| Recent accident | $134 | $233 |
| DUI conviction | $149 | $257 |
Car insurance rates vary from company to company because not all insurers price coverage the same way. Personal factors like your age, driving history, and credit play a role in what you pay for coverage.
Check out the chart below to see the average monthly liability and full-coverage premiums from the 10 largest car insurance companies in the U.S.
Company | Average Liability Premium | Average Full-Coverage Premium |
|---|---|---|
| State Farm | $56 | $108 |
| Progressive | $102 | $171 |
| GEICO | $91 | $138 |
| Allstate | $74 | $137 |
| USAA | $53 | $98 |
| Farmers | $111 | $211 |
| Liberty Mutual | $158 | $215 |
| Travelers | $100 | $184 |
| AAA | $127 | $154 |
| American Family | $80 | $146 |
Comparing quotes guarantees the best deal, regardless of the coverage you need.
Every car insurance company has its own formula for calculating rates. That’s why shopping around is so important — one company might offer the lowest rates for liability coverage, while another might be cheaper for full coverage.
Let’s start by looking at the car insurers with the lowest rates for liability-only insurance and full coverage.
Company | Average Monthly Premium |
|---|---|
| COUNTRY Financial | $40 |
| Auto-Owners | $46 |
| USAA | $53 |
| State Farm | $56 |
| NJM | $62 |
| Mile Auto | $69 |
| Allstate | $74 |
| Erie | $79 |
| American Family | $80 |
| Commonwealth Casualty | $88 |
| Safeco | $88 |
| GEICO | $91 |
| Root | $91 |
| Dairyland | $93 |
| The General | $93 |
| Mercury | $95 |
| Nationwide | $96 |
| Direct Auto | $96 |
| National General | $98 |
| Travelers | $100 |
| Bristol West | $102 |
| Progressive | $102 |
| GAINSCO | $104 |
| Metromile | $106 |
| Farmers | $111 |
| Anchor | $112 |
| Elephant | $119 |
| Chubb | $120 |
| CSAA | $127 |
| AssuranceAmerica | $131 |
| 21st Century | $132 |
| Clearcover | $140 |
| Shelter | $147 |
| State Auto | $149 |
| Liberty Mutual | $158 |
| The Hartford | $160 |
| Amica | $286 |
Company | Average Monthly Premium |
|---|---|
| COUNTRY Financial | $72 |
| Auto-Owners | $77 |
| NJM | $94 |
| USAA | $98 |
| State Farm | $108 |
| Mile Auto | $109 |
| Erie | $121 |
| Allstate | $137 |
| GEICO | $138 |
| Safeco | $139 |
| American Family | $146 |
| Root | $150 |
| CSAA | $154 |
| Mercury | $160 |
| Anchor | $161 |
| Direct Auto | $161 |
| Metromile | $161 |
| Elephant | $167 |
| Progressive | $171 |
| The General | $174 |
| National General | $175 |
| Nationwide | $178 |
| Travelers | $184 |
| Clearcover | $191 |
| Commonwealth Casualty | $203 |
| Bristol West | $204 |
| Farmers | $211 |
| Chubb | $213 |
| Liberty Mutual | $215 |
| GAINSCO | $217 |
| Shelter | $228 |
| 21st Century | $231 |
| AssuranceAmerica | $243 |
| The Hartford | $243 |
| State Auto | $250 |
| Dairyland | $252 |
| Amica | $434 |
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If you go with a full-coverage policy, ask what it covers and what it doesn’t. Some companies offer extra coverage as optional purchases.A few add-ons you might want to consider if your policy doesn’t already have them include:
Gap insurance pays the difference between what you owe on your loan and the car’s actual cash value.
Rental reimbursement covers a rental car while your vehicle is undergoing repairs.
Roadside assistance provides towing, jump-starts, and fuel delivery if your car breaks down.
Rideshare insurance extends your auto policy to protect you while driving for Uber, Lyft, or another ridesharing service.
Uninsured/underinsured motorist coverage protects you if a driver without coverage or enough coverage hits you. It’s a good idea to consider it even if your state doesn’t require it.
Car insurance policies can raise many questions, especially when choosing between liability and full coverage. Consider these answers to common questions people have about the two coverages.
It depends. Whether liability or full coverage is better depends on your unique needs, budget, and risk tolerance. Liability-only coverage makes sense if you drive an older car that isn’t worth much, need to keep your insurance costs low, and are comfortable taking on more personal risk.
You’ll need full coverage if you have a car lease or loan and want the most comprehensive protection.
It depends. You might consider dropping full coverage for liability-only coverage when your car’s value drops and a potential claim payout may be low. It may also be worth dropping it if you can afford to pay for vehicle repairs or to replace out of pocket.
Regardless, you should speak with your insurer and make sure to maintain your state’s minimum coverage requirements.
Though a full-coverage policy provides you with more protection, it typically comes with higher premiums and deductibles. Keep in mind that full coverage doesn’t cover everything, and you’ll still need to consider optional coverages for the greatest protection and peace of mind.
A full-coverage policy typically includes collision coverage. This coverage pays for damages from something other than a collision, such as hitting a tree, vandalism, or hail damage. But comprehensive coverage won’t pay to repair or replace your vehicle after a collision with another car.
Liability-only coverage means your insurance will pay for injuries and damage you cause to others in an accident, but it won’t cover repairs to your car or your medical bills. Instead, you’ll need to pay for your own car’s damage if you’re at fault in an accident.
It depends on your unique situation. The choice to keep full coverage on a paid-off car depends on your car’s value and your risk tolerance.
If your vehicle is older and not worth much, liability-only coverage may be enough if you can afford to replace it if you total it. But you might want to keep it even on a paid-off car if you’re not comfortable paying for major repairs.
Liability insurance is cheaper than full-coverage insurance because it offers much less protection. Insurance companies charge less for liability because the risk of paying out a significant amount of money — or any at all — is much lower than for full coverage.
Data scientists at Compare.com analyzed more than 50 million real-time auto insurance quotes from more than 75 partner insurers in order to compile the rates and statistics seen in this article. Compare.com’s auto insurance data includes coverage analysis and details on drivers’ vehicles, driving records, insurance histories, and demographic information.
All the rates listed in this article have been collected from a combination of real Compare.com quotes and external insurance rate data gathered in collaboration with Quadrant Information Services. Compare.com uses these observations to provide readers with insights into how auto insurance companies determine their premiums.
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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.
Learn more about us, our team, and what makes us tick.
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Amy Beardsley is a seasoned insurance expert who’s been writing for Compare.com since 2023. She has more than 12 years of industry knowledge and expertise in auto, home, life, commercial, and other insurance products. Amy’s work has been published by Berkshire Hathaway Specialty Insurance, Legal & General, NerdWallet, Robinhood, Insurify, NEXT Insurance, and more.
Amy worked as a court administrator before becoming a content marketing writer. Her legal background has equipped her with the ability to simplify complex technical language into easy-to-understand content.
She graduated magna cum laude from Ferris State University, where she earned a Bachelor of Science in Business Administration and Legal Studies.
Lequita Westbrooks is an insurance editor at Compare.com. Her writing and editing experiences span several industries, including insurance, personal finance, higher education, and more. She excels at explaining complex topics like auto insurance in simple, easy-to-understand language and is passionate about helping readers save money. Lequita graduated from the University of South Florida, where she earned her Bachelor’s degree in English.
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