Should you get full coverage on a used car?
Asked by: Mr. Kirk Grant Jr. | Last update: July 14, 2025Score: 4.1/5 (75 votes)
Should I get full coverage insurance on a used car?
While most states don't require you get full insurance coverage when purchasing a car, many finance lenders who want to protect their investments require full coverage regardless of whether your car is gently used or new.
At what point is full coverage not worth it?
Paying for comprehensive and collision — the coverages that many people mean when they say "full coverage" — may not be worth it if your car's value is minimal and your policy includes a high deductible. Usually, you have to have comprehensive and collision on a financed car because most lenders require it.
Is it worth having full coverage on an older vehicle?
Full coverage is only worth having for a 15-year-old car if its market value is more than a few thousand dollars.
Do you need full coverage on an owned car?
If you have a loan or a lease on your car, you're usually required to have full coverage insurance. If you own your vehicle outright, you'll need only your state's minimum insurance requirements to drive legally.
Should I Keep Full Coverage on My Paid Off Car?
At what point should you drop full coverage on your car?
For example, you might want to drop comprehensive coverage if: You park your car in the garage and protect it from animals, falling objects, and severe weather. You plan to replace your car next time it needs big repairs. Your car is worth less than the deductible on your comprehensive coverage.
What happens if I don't put full coverage on my car?
Having only the minimum liability required by your state with no additional coverage leaves a large gap when it comes to repairing your vehicle after an accident.
Should I carry full coverage on a 10 year old car?
If your vehicle is older and is not worth as much, you may be able to reduce your insurance premium by avoiding comprehensive and collision coverage. However, if you have a loan on the vehicle or drive a leased vehicle, you may be required to have comprehensive coverage.
What are the disadvantages of having full coverage car insurance?
The only real disadvantage of “full coverage” car insurance is the possibility that you may be paying for more car insurance than you need, given your vehicle's value and your financial situation.
Is it better to have collision or comprehensive?
If your car is damaged in a road collision with another car or object and you're at fault, only your collision coverage can help pay to repair it. Only comprehensive coverage covers losses caused by contact with animals, civil disturbances, fires, natural disasters, theft, and vandalism.
Is it smart to have full coverage?
Risk Tolerance: Full coverage can provide peace of mind by protecting your car from various risks, including accidents, theft, and weather damage. If you prefer the extra security, keeping full coverage might be worth it, even after the car is paid off.
Does full coverage cover at-fault accidents?
Full coverage car insurance covers the costs to repair damage to your vehicle in an at-fault accident. However, in most states, it doesn't include coverage for bodily injuries that you or your passengers sustained. In “no-fault” states, your auto insurance does cover your bodily injuries up to the limits purchased.
Why am I paying so much for full coverage insurance?
Driving record
Incidents such as accidents (even if you weren't at fault), speeding violations, reckless driving, and driving while intoxicated can increase premiums. If you've filed a claim in the past few years, this might also result in an increase to your premium.
Do I need full coverage on a car I'm financing?
If you have an auto loan, the lender will likely require you to have comprehensive and collision coverage, in addition to liability and other legally required coverages, which your lender may refer to as "full coverage." Lenders may also require additional coverages, such as uninsured motorist coverage or gap insurance ...
Does insurance go up if you buy a used car?
Generally, used cars are cheaper to insure due to their lower market value and the potential for reduced coverage needs. However, there are exceptions to this trend. For instance, insuring a luxury or high-performance used car can be more expensive than a standard new car.
Will a used car typically have higher insurance premiums?
Insurance is usually cheaper for used vehicles because it doesn't cost as much to repair and replace them as new cars. However, factors other than your vehicle's age, such as your car's make, model and safety technology, can impact your premium, so used car rates aren't always less expensive.
Why do dealerships require full coverage insurance?
Lenders typically mandate comprehensive and collision coverage to protect their investment. These coverages extend beyond the basic liability insurance required by law and ensure your vehicle is safeguarded against various risks.
Will full coverage fix my car?
Car insurance may help cover the cost of repairs if the issue is the result of a collision or another covered incident, such as theft or fire. But repairs for routine wear and tear or mechanical breakdowns are typically not covered by an auto insurance policy.
When should I drop full coverage on my car?
If your annual insurance is over ten percent of your car's value, it might not be worth taking out the additional protection. If you feel like you still need the collision and comprehensive covers, you might want to raise your deductible to lower the cost.
How many miles is too much for a 10 year old car?
The average mileage a car accrues per year is 12,000 miles. Given that number, the average 10-year-old car should have roughly 120,000 miles on the odometer. You can use these numbers to determine if the car you're looking to buy is considered to have high mileage or low mileage for the age of the vehicle.
At what age should your car insurance go down?
Experienced drivers are less likely to have accident claims, which means they cost less to insure. At Progressive, the average premium per driver tends to decrease significantly from 19-34 and then stabilize or decrease slightly from 34-75. At age 75, the average premium begins trending upward.
Is it cheaper to insure an older car?
In general, auto insurance for older cars may be cheaper than insuring newer vehicles of the same make and model if the used car is cheaper to repair or replace. A car depreciates in value over time, which lowers the maximum amount an insurance company would have to pay in the event of an accident.
What happens if I crash my car with full coverage?
Assuming you're covered, your insurer will send a payment to your lender for the actual cash value of the car, minus any deductible. Make sure you give your lender's contact information and the account number to your agent or insurance company.
How do I know if I need full coverage on my car?
You may want to consider “full coverage” if: You're financing a car. Lenders typically require “full coverage” in addition to other coverages required by the state. You want financial protection.