It’s one of the most common questions we hear at Cardinal Insurance Group. And the honest answer is: it depends.
But before we get into whether you need it, there’s something important to clear up first.
There really is no such thing as ‘full coverage’
Although we hear it often from people, “full coverage” is not an official insurance term.
When most people say “full coverage,” they’re usually referring to a combination of these three coverages.
- Liability insurance
Covers lawsuits that result from injuries or property damage you cause to others - Comprehensive coverage
Covers non-collision damage like theft, vandalism, hail, windshield damage or hitting a deer - Collision coverage
Covers damage to your vehicle from an accident
Together, these are often called full coverage, but they still don’t cover everything.
There are a number of other optional ‘endorsements’ that you can add to your auto policy and they usually have to be added per vehicle, not per policy.
- Roadside assistance
- Rental car coverage
- Gap insurance
- OEM (Original Equipment from the Manufacturer vs generic)
- Waiver of Glass Deductible
- New car replacement
These optional coverages have to be specifically added with the resulting premium charges to be included in your policy.
So, Do You Actually Need Comp and Collision?
This is where the decision becomes personal. Whether you need more than liability depends on a few key factors:
- The value of your vehicle
- Whether you still owe money on it
- Your ability to pay for repairs or replacement out of pocket
- Your personal risk tolerance
You Probably Want Comp and Collision If:
- Your vehicle is worth more than about $4,000
- You have a loan or lease
- You couldn’t easily replace the car if it were totaled
- You want financial protection regardless of fault
You Might Consider Dropping Them If:
- Your vehicle is older and low in value
- You’re comfortable paying for repairs yourself
- Saving on premium matters more than replacing the car
There’s no universal right answer. The key is understanding the trade-off.
The Hidden Cost of Cutting Coverage
Dropping coverage can lower your premium, but it also shifts the risk back onto you. As I often tell people, insurance is really about using the carrier’s checkbook vs your own. Where do you want the funds to come from at the time of loss?
A common example we see in Northern Michigan:
A deer runs into the road and you are not able to avoid hitting it. If you have removed comprehensive coverage from that vehicle because it was paid off, the damage to your vehicle is not going to be covered by the insurance.
It’s an even more upsetting situation if you did not tell us you had a lien against it (still own a bank for the vehicle), and it’s damaged or totalled and you still owe on it, but have no insurance to replace or repair it.
That situation is far more common than people expect, and incredibly frustrating when it happens.
The Better Question to Ask Yourself
Instead of asking, “Do I need full coverage?”
Ask this instead: “If my car were damaged or totaled tomorrow, would I be financially OK handling it myself?”
If the answer is no, then liability-only coverage probably isn’t enough.
How to Tell If You’re Overpaying
Some drivers do carry more coverage than they need, or pay more than necessary for it. The best way to know is to review your policy with intention.
A good review with a knowledgeable agent should include:
- Comparing the rates with several insurance companies for you
- Comparing different deductible options
- Reviewing with you optional coverages like rental, roadside, or gap
- Making sure you’re bundling your home and auto when possible
- Confirming coverage still matches your current vehicle and lifestyle
At Cardinal, we’ll walk through the numbers side-by-side so you can make an informed decision; not a pressured one.
Bottom Line
“Full coverage” is just a label. What actually matters is whether your insurance protects your real financial risk.
If you’re unsure whether your coverage still makes sense, a quick review can give you clarity and peace of mind.
Have questions about your auto policy?
We’re happy to review it and explain your options in plain English, no pressure, no jargon.
Cardinal Insurance Group Trusted Guidance. Personalized Service
Written by Linda M. Fisher, AAI, CIC, CPRIA, CPRM, LIC, LUTCF – Agency Founder & Owner