Do you have to have full coverage when you finance a car?

It is not a state requirement to have full coverage (meaning at least the minimum state auto insurance limits plus physical damage coverages), but it's usually a requirement from your finance company or lender. The lender is your lien holder and thus the car is their asset until you pay it off. read more

Most lien holders require full coverage since the car is their asset, and if it is damaged or totaled out and you do not have insurance to cover it, they will have to come after you personally to repair it or pay off a totaled car, which is much harder than your insurance company taking care of it for you. read more

Coverage You’re Obligated to Carry. Let’s start with the basics. Minimum coverage requirements vary by state, and whether or not you have financed or leased your vehicle. If you own your car outright and live in a more lenient state, your situation may only require you purchase liability insurance. read more