Full Coverage Car Insurance in PA: What Does “Full Coverage” Actually Mean?

Written by Bob Kelly, Agency Principal at PolicyVisor, with over 20 years of insurance experience

---

 

“Do you have full coverage?”

People say this all the time.

The problem is that “full coverage” is not really a defined insurance term.

If you have an auto insurance policy in Pennsylvania, you already have some form of liability coverage. It may only be the state minimum, but there has to be some baseline liability coverage on the policy.

So when someone tells me they have “full coverage,” I usually take that to mean they also have coverage for physical damage to their own vehicle.

In other words, comprehensive and collision coverage.

I will usually confirm that by asking:

“When you say full coverage, do you mean you have comprehensive and collision on the car?”

Then I usually ask the next question:

“What is your deductible?”

Because saying you have comprehensive and collision still does not tell me much about how the policy will actually work when you have a claim.

What Is a Deductible?

Your deductible is generally the amount you are responsible for paying before the insurance company pays the remaining covered physical damage claim.

I usually explain deductibles as a small gamble.

You may be able to save $10, $15, or $20 a month by taking a higher deductible.

In exchange, you are taking the risk that if you have a claim, it could cost you another $500 or $1,000 out of pocket.

Sometimes that tradeoff is worth it.

Sometimes it is not.

If moving from a $500 deductible to a $1,000 deductible only saves you a few dollars a month, I may not think that is a great gamble.

If it saves you a meaningful amount every year and you are comfortable coming up with the extra money if something happens, then it may make sense.

That is really how I like people to think about deductibles:

How much am I saving, and how much more am I risking?

For example, if moving from a $500 deductible to a $1,000 deductible saves you $180 a year, you are saving $180 in exchange for taking on another $500 of risk if you have a covered collision claim.

Some people are completely comfortable with that.

Others would rather pay a little more each month and keep the lower deductible.

There is no automatic right answer. I just like to see the actual savings before deciding whether the tradeoff makes sense.

What Does Collision Coverage Do?

Collision coverage helps pay for damage to your own vehicle when it is damaged in a collision, subject to your deductible and the terms of the policy.

Some common examples are:

• You hit another vehicle
• Another vehicle hits you
• You back into a pole
• You slide into a guardrail
• You hit a parked car
• Your vehicle rolls over
• Someone hits your parked car and leaves without giving you their information

That last one surprises people.

If you walk out of a store and find that somebody hit your car in the parking lot and took off, the physical damage to your car would generally be handled under collision coverage if you carry it, subject to your deductible and policy terms.

So if you have $2,000 worth of damage and a $1,000 collision deductible, that deductible still matters.

If your car is financed or leased, the lender or leasing company will generally require collision coverage.

If you own the vehicle outright, collision is usually optional.

But paid off does not automatically mean you should drop it.

The question I usually ask is:

If this car were totaled tomorrow, would you be comfortable replacing it yourself?

If the answer is no, keeping collision coverage may still make sense.

Is Comprehensive and Collision Always Worth Carrying?

No.

This is another conversation I have pretty often.

Just because you can carry comprehensive and collision on a vehicle does not mean it always makes sense financially.

My Uncle Tommy is the example I always use.

Years ago, he was carrying comprehensive and collision on an old 2003 Nissan Sentra.

I used to joke that if he got a flat tire, the car would probably be a total loss.

Obviously, that was an exaggeration.

But the point was real.

The car was not worth much, and he was still paying every year for physical damage coverage that could only pay so much if the car were totaled.

At some point, you need to look at the numbers.

What is the car worth?

What are you paying every year for comprehensive and collision?

What is the deductible?

If a car is worth only a few thousand dollars and you have a $1,000 deductible, there may not be a huge potential insurance payout left after the deductible.

If you are paying several hundred dollars a year for that coverage, keeping it forever may not make much sense.

That does not mean everyone should drop physical damage coverage on an older car.

I usually look at:

• The value of the vehicle
• The cost of comprehensive and collision
• The deductible
• Whether you could afford to replace the car yourself
• Whether you still owe money on the vehicle

If the car is financed, you usually do not have much of a choice.

If it is paid off, then it becomes a financial decision.

Sometimes keeping the coverage makes sense.

Sometimes it does not.

The important thing is to actually look at it instead of paying for the same coverage year after year because nobody ever reviewed the policy.

What Does Comprehensive Coverage Do?

Comprehensive coverage generally handles physical damage to your vehicle from something other than a collision.

Common examples include:

• Theft
• Vandalism
• Fire
• Hail
• Falling objects
• Animal strikes
• Certain glass claims
• Storm damage

If a tree branch falls on your parked car, that would generally fall under comprehensive.

If you hit a deer, that is generally comprehensive too.

You may also have a different deductible for comprehensive than you do for collision.

For example, you might have a $250 comprehensive deductible and a $500 collision deductible.

Again, this is why simply saying “I have full coverage” does not tell the whole story.

Does Full Coverage Mean Everything Is Covered?

No.

That is probably my biggest problem with the phrase.

“Full coverage” sounds like everything is covered.

It is not.

Every auto policy has limits, deductibles, exclusions, conditions, and optional coverages.

You can have comprehensive and collision coverage and still have significant gaps elsewhere in the policy.

That is why we look at the whole policy.

Liability Coverage Still Matters

Even if you have comprehensive and collision, your liability limits are still extremely important.

Liability coverage helps protect you when you are legally responsible for injuring someone else or damaging their property.

Pennsylvania allows drivers to carry fairly low minimum liability limits.

That means someone can have a brand-new car with comprehensive and collision coverage and still carry very little protection if they seriously injure somebody.

They may tell me they have “full coverage.”

Their car may be well protected.

Their financial situation may not be.

Those are two different things.

Uninsured and Underinsured Motorist Coverage

This is another part of the policy I look at closely.

Uninsured and underinsured motorist coverage can help protect you if someone else causes an accident and either has no insurance or does not have enough insurance.

That matters in Pennsylvania because another driver can legally be carrying relatively low liability limits.

If that person seriously injures you, their insurance may not be enough.

So when I review a policy, I am not just looking for comprehensive and collision.

I am also looking at the uninsured and underinsured motorist limits and whether the coverage is stacked.

What About Stacking?

Pennsylvania allows uninsured and underinsured motorist coverage to be stacked.

In simple terms, stacking can increase the amount of UM/UIM coverage available based on the number of vehicles on the policy.

For example, two vehicles with $100,000 of stacked UM coverage may provide access to $200,000 of coverage, depending on the policy and the circumstances of the claim.

People sometimes waive stacking because it saves money.

That may be fine.

I just think you should understand what you are giving up before you sign the waiver.

What About Medical Coverage?

Pennsylvania also requires first-party medical benefits on an auto policy.

The minimum limit is fairly low.

Depending on the situation, we may look at higher medical limits.

Sometimes the difference in premium is pretty small.

Again, I would rather actually look at the cost than assume the minimum is automatically the right choice.

Does Full Coverage Include Rental Car Coverage?

Not necessarily.

This catches people off guard all the time.

You can have comprehensive and collision and still not have rental reimbursement.

If your car is in the shop for two or three weeks after an accident, that can become an expensive surprise.

Rental reimbursement is usually optional, and the limit matters.

One policy might give you $30 a day.

Another might provide $50 or $75 a day.

If you depend on your vehicle every day, it is worth checking what you actually have.

What About Roadside Assistance?

Roadside assistance is another optional coverage.

Depending on the company, it may help with things like:

• Towing
• Battery jump-starts
• Lockouts
• Flat tires
• Fuel delivery

Having “full coverage” does not automatically mean roadside assistance is included.

What About GAP Coverage?

If you finance or lease a newer vehicle, GAP coverage is another thing worth checking.

Comprehensive and collision coverage generally pays based on the covered value of the vehicle.

That does not necessarily mean the insurance company will pay whatever you still owe the bank.

If you owe $35,000 on a vehicle that is worth $29,000 and it is totaled, there may be a difference.

That is where GAP coverage or loan/lease payoff coverage may come into play.

Some people buy GAP through the dealership.

Some insurance carriers offer a similar option.

Either way, I think you should know whether you have it.

What We Look at at PolicyVisor

When someone sends us a declarations page, I am not just checking a box to see whether comprehensive and collision are there.

I want to know what the whole policy looks like.

We generally review:

• Liability limits
• Property damage limits
• Uninsured and underinsured motorist coverage
• Stacking
• Medical benefits
• Comprehensive coverage
• Collision coverage
• Comprehensive deductible
• Collision deductible
• Rental reimbursement
• Roadside assistance
• Loan or lease payoff coverage when needed
• Full Tort vs. Limited Tort
• Whether the drivers and vehicles are listed correctly

That gives us a much better picture of what someone actually has.

A Cheap “Full Coverage” Policy Can Still Be a Bad Deal

This happens all the time.

Someone gets an online quote.

It has comprehensive and collision.

The price is cheaper.

Great.

Then we compare the details.

Maybe the liability limits dropped.

Maybe the UM/UIM coverage is lower.

Maybe stacking disappeared.

Maybe rental coverage is gone.

Maybe the collision deductible went from $500 to $1,500.

The cheaper policy may still make sense.

But now you are making that decision with all the information.

I am all for saving people money.

I just do not want to save somebody money by quietly taking away coverage they thought they still had.

So What Does “Full Coverage” Actually Mean?

When I hear someone say they have full coverage, I usually take it to mean:

They have liability coverage plus comprehensive and collision coverage on their vehicle.

That is usually what they are trying to tell me.

But that is where the conversation starts.

Not where it ends.

The next questions are:

• What are your deductibles?
• How much are those deductibles saving you?
• Is the car worth carrying comprehensive and collision on?
• How much liability coverage do you have?
• What are your UM/UIM limits?
• Is your coverage stacked?
• Do you have rental coverage?
• What medical benefits do you carry?
• Do you need GAP coverage?

Those questions tell me a lot more than the words “full coverage.”

Two people can both say they have full coverage and have completely different policies.

Want Us to Take a Look?

PolicyVisor is an independent insurance agency serving clients throughout Pennsylvania, including Springfield, Delaware County, and the greater Philadelphia area.

If you send us your current declarations page, we can go through it with you and explain what you actually have in plain English.

We can also compare options from multiple insurance companies when it makes sense.

We are not just trying to find the lowest price on the screen.

We want to make sure you understand what you are buying, what you are paying for, and what you might be giving up to get a lower premium.

And if your current policy is already a good fit, we will tell you that too.

Disclaimer: This article is for general informational and educational purposes only and is not intended as individualized insurance, legal, financial, or tax advice. Coverage needs vary based on individual circumstances. Insurance coverage is determined solely by the terms, conditions, exclusions, endorsements, and limits of the policy actually issued. Nothing on this website binds, modifies, extends, or guarantees insurance coverage. Please speak with a licensed insurance professional regarding your specific insurance needs and consult an appropriate legal, tax, or financial professional when those issues are involved.