Legal requirements for auto insurance vary from state to state. However, most states require different limits of similar or identical car insurance coverages. This does not typically include full coverage car insurance.
State Required Car Insurance
States generally require all drivers to carry a certain amount of car insurance in order to drive legally. In Virginia, for example, all drivers are required to carry at least:
- $25,000 in bodily injury liability per person
- $50,000 in bodily injury liability per accident
- $20,000 in property damage liability
Liability insurance is only designed to cover damages and injuries you may cause someone else while operating the insured vehicle. This is especially important in fault states, where the driver declared at-fault for an accident is responsible for paying for all (or the majority of) damages.
What is Full Coverage Car Insurance?
Full coverage car insurance simply refers to the highest amount of car insurance you can place on a single vehicle. This provides you coverage for nearly any threat your vehicle may face both on and off the road. A full coverage car insurance policy generally includes:
- Comprehensive Coverage: Comprehensive coverage provides compensation for damages to your vehicle caused by fire, wind, hail, lightning, falling objects, theft, vandalism and more.
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- Collision Coverage: Collision coverage provides compensation for damages to your vehicle caused by a collision with another vehicle or object.
- Liability: Liability insurance covers bodily injury and property damage you may cause someone else while operating the vehicle.
- Medical Payments Coverage: This insurance is required in a few no-fault states and covers compensation for medical bills for you and your passengers after an accident.
- Uninsured/Underinsured Motorist: This insurance covers damages involved in an accident with another driver who is not carrying insurance.
- Roadside Assistance: Roadside assistance covers trip interruptions such as running out of gas, flat tires and towing.
When Can I Drop Full Coverage Car Insurance?
Although full coverage car insurance isn’t legally required by a state or federal law, full coverage car insurance may be required as long as you have a loan on your vehicle. If you purchase a brand-new vehicle, you will likely have to carry full coverage car Insurance.
Even without the requirement, full coverage car insurance is recommended for most drivers. The only time full coverage may not be recommended is if the value of the vehicle is less than the cost of insuring it.
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