What each covers
| Liability only | Full coverage | |
|---|---|---|
| Injuries you cause to others | ✓ | ✓ |
| Damage you cause to others’ property | ✓ | ✓ |
| Damage to your car in a crash (collision) | ✗ | ✓ |
| Theft, hail, fire, flood, animals (comprehensive) | ✗ | ✓ |
| Required if you have a car loan or lease | No | Usually yes |
“Full coverage” isn’t an official policy type; it usually means liability plus collision and comprehensive. Uninsured motorist and medical coverage may be required or optional depending on your state.
Liability limits explained
Liability limits are written as three numbers, such as 50/100/50: $50,000 for injuries to one person, $100,000 for all injuries in one crash, and $50,000 for property damage. State minimums are often much lower than the cost of a serious crash. If damages go beyond your limits, you can be held personally responsible, so many experts suggest at least 100/300/100 if you own a home or have savings.
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Sponsored listings. FindBestInsurance may be paid when you click them.When to keep full coverage
- You have a loan or lease; the lender will almost always require it.
- Your car is newer or valuable, and you couldn’t afford to replace it from savings.
- You live where theft, hail or flooding are common.
When liability-only can make sense
- Your car is paid off and worth little. A common rule of thumb: if a year of collision and comprehensive costs more than about 10% of the car’s value, consider dropping them.
- You have enough savings to repair or replace the car yourself.
Middle-ground options
You don’t have to choose all or nothing. You can keep comprehensive (often cheap) and drop collision, or raise your deductibles from $500 to $1,000 to cut the cost of full coverage. See what car insurance costs for typical prices.
Frequently asked questions
What is the difference between full coverage and liability?
Liability pays for damage and injuries you cause to others. Full coverage adds collision and comprehensive, which pay for damage to your own car.
Is full coverage required by law?
No state requires collision or comprehensive, but lenders and leasing companies usually do.
When should I drop full coverage?
When your car is paid off and its value is low compared with what collision and comprehensive cost, often around the point where a year of that coverage costs more than 10% of the car’s value.
How much more does full coverage cost?
About $2,357 a year on average versus $650 for minimum liability, based on NerdWallet’s 2026 analysis.
Sources
- NerdWallet: How much is car insurance? (2026 rate analysis)
- Insurance Information Institute: What determines the price of an auto insurance policy?
Figures checked November 7, 2026. Insurance rules and prices change and vary by state and insurer; confirm details with the insurer or your state.