Liability vs Full Coverage | In Laymen’s Terms

It’s important to understand the differences between liability coverage and full coverage when insuring a vehicle. We are going to break down the key differences so that you can understand what comes with each type of insurance policy. It’s important to understand the benefits of each policy type so that you can make an informed decision when shopping for insurance. 

What is Liability Coverage?

Liability coverage is required in just about every jurisdiction in the United States. This protects other drivers from any accidents that you may cause. If you have liability coverage and cause damage to someone else’s vehicle, your insurance company will cover the damages and any other related costs to the other person’s vehicle. 

What is Full Coverage?

Full coverage is more expensive and has several additional benefits than just the liability coverage. In addition to covering damage to other vehicles, full coverage policies will also cover damage to your own vehicle. There are a lot of individual benefits for both liability policies and full coverage policies. 

We’ll continue to look at the similarities and differences between liability insurance and full coverage. We are now going to shift focus towards some of the most common features of liability insurance and compare those features to policies that offer full coverage and additional perks. 

What are the Benefits of Liability Insurance?

Liability insurance is one of the most affordable insurance plans and is generally required in order to operate a vehicle on public roads. It doesn’t include coverage to your own vehicle, but it does cover vehicle damages and injury costs for others. 

Most policies have a set requirement set for the maximum amount of money that can be spent on an individual’s injury. It’s not uncommon for this to be set at around $10,000 per person but you should check the specifics of your insurance policy to know for sure. 

Accidents happen on the road and it’s important to have sufficient coverage so that you don’t have to cover vehicle damages and injury costs for someone else from your own bank account. Liability coverage provides an extra layer of protection for you in the event of an accident with another vehicle. 

What are the Benefits of Full Coverage?

Full coverage can provide even more protection in the event of an accident, but you will have to pay higher insurance premiums for additional layers of coverage. Source.

This type of policy usually includes comprehensive insurance protection and will cover damages that are related to on-road accidents and damages that may be caused by some other hazard. This protection can include stolen items from your vehicles, such as a side mirror or any other similar objects. In many cases, this type of insurance plan will also cover any damages up to your car’s real-time value. 

Most regions don’t require full coverage so it’s definitely not the most popular type of insurance policy that you can acquire. The main benefits are that additional types of damages are covered and your own vehicle is protected, unlike liability insurance, where only the other person’s vehicle is protected. 

Differences | Liability vs Full Coverage

If you’re still struggling to understand the differences between liability and insurance full coverage, spend a few moments taking a look at the comparison chart in the section below.

Liability InsuranceFull Coverage
Most states in the country require a minimum of liability insurance in order to operate a vehicle on public roads.Full coverage is not required but it can provide additional layers of protection against different types of damages.
Liability insurance covers damages to other vehicles that were your own fault. Full coverage insurance covers damages to other vehicles and your own.
One of the nice things about liability insurance is that it is much more affordable than the full coverage insurance policy. Just about every type of full coverage insurance policy is going to cost more than liability. You will get several additional benefits that liability insurance doesn’t offer. 
Liability insurance has a maximum amount of money that can go towards another person’s vehicle damages or bodily injury costs.Full coverage policies also have a maximum amount of money that can go towards another person’s vehicle damages or bodily injury costs. This amount is usually more than liability insurance.
This type of insurance is best for someone that wants the absolute cheapest insurance policy with minimal coverage.If you want extensive coverage that protects you from different types of hazards, you’re probably interested in full coverage. 

Both types of insurance policies have some pros and cons, but it’s important to remember that full coverage is going to provide you with additional layers of protection in the event of damage to your vehicle.

At the absolute minimum, you are going to need liability insurance. This is required in nearly every state and will save you a lot of money ‘out of pocket’ if you experience an accident while driving. Source.

Both options may be viable, depending on your circumstances. Most drivers prefer to invest in minimal liability insurance because it is the least expensive option and covers the minimum requirements in most states. It’s important to keep track of your specific details relating to your vehicle’s insurance policy before you commit to a specific policy. 


There are some very clear differences between liability insurance and full coverage plans. You should spend some time researching specific plans and considering the differences that are mentioned above in the chart. 

Only you are capable of making the best decision for your specific lifestyle and you should make sure that you are confident before finalizing your decision.