Contrary to what you may be led to believe, “full coverage” is not all-inclusive. Rather, it’s a term that refers to a number of mandatory and optional coverages under your auto insurance policy.
Our sources include the Financial Consumer Agency of Canada’s car-insurance overview, FSRA’s current optional-coverage guide, SGI’s basic auto-damage guidance, and MPI’s Basic Autopac all-perils guidance to check what “full coverage” can mean under different provincial systems.
Read More: Review Ontario Car Insurance Options
What’s Included in Full Coverage Car Insurance?
When you hear the term “full coverage” car insurance, most likely people refer to the following package of coverages:
- Liability insurance. This type of coverage, which is mandatory, protects against bodily injury and third-party property damage should you be found to be at-fault in an accident.
- Accident Benefits. The details of Accident Benefits vary by province. For example, for Ontario policies issued, renewed or changed on or after July 1, 2026, medical, rehabilitation, and attendant-care benefits remain mandatory, while income replacement and other benefits are optional.
- Collision or upset. Collision coverage may reimburse covered collision damage after the deductible. DCPD and public-plan physical-damage coverage are separate and vary by province.
- Comprehensive coverage. This coverage can reimburse you for damage caused by specific perils, like theft or fire. Comprehensive can also help with costs from weather-related damage (think hail), vandalism, or falling objects.
- Underinsured or uninsured motorist coverage. Some forms of uninsured and underinsured driver protection are included with your auto insurance, but others are offered as optional coverages, and specifics can vary by province.
The decision of whether or not to purchase Collision and/or Comprehensive coverage, which are optional in many private auto insurance systems, is a personal one. However, there are a few situations in which it makes sense to invest in these types of coverage:
Reasons To Have Full Coverage Car Insurance
Lease Or Loan Requirements
Your lessor or lender may require Collision and Comprehensive coverage as well as specific deductibles while you make payments on your vehicle.
Protecting An Expensive Vehicle
Depending on your cash reserves, it’s worth considering Collision and Comprehensive coverage to help with repairing or replacing a newer or expensive vehicle. Do the math and make sure you understand how settlements are determined, what’s included, what’s excluded, and your deductible amount.
Driving In High-Risk Areas
Depending on the type of risk, whether that’s bad weather, vandalism, or theft, it can be prudent to invest in Comprehensive or Collision insurance in areas considered to be risky. This might not necessarily be a heavily-populated area.
Reasons To Drop Full Coverage Car Insurance
You Just Finished Leasing Or Paying Off Your Car Loan
Without a loan or lease requiring Collision and/or Comprehensive coverage, it’s an opportunity to revisit these coverages and their importance to you.
You Have a Less Expensive Car:
For example, say you have an $8,000 vehicle, $1,000 deductible, and you’re paying $650 for Collision coverage each year. After depreciation and other adjustments, a total-loss settlement could be under $7,000. You may or may not consider Collision coverage worth it in this scenario.
Ultimately, it’s worth considering the ratio of your car’s value, the cost of Collision and/or Comprehensive insurance, and your ability to replace the vehicle without accruing debt.
Read More: Is Collision Coverage Worth It on an Older Vehicle?
You Don’t Use Your Car That Much:
While some people may not want to take the chance of being without Collision or Comprehensive coverage, there are other factors that can sway your decision about dropping one or both. For example, if you rarely drive, you’re lowering your chances of being involved in a collision. But your vehicle is still at-risk for Comprehensive claims while it’s not being used, from hail or flood damage, fire, theft, or even getting struck while parked.