Many people have been told that they should always have full coverage vehicle insurance. I know I was told that many times. The thing is though, after some careful research I have found that not only is that untrue, but there are times when it is simply wasteful and not very smart to have full-coverage insurance on a vehicle.

First, let us look at the obvious situations that require a person to have full coverage. If you have a loan on your vehicle, it is a given that you have to have full-coverage. This is something that the bank requires of you are part of the agreement to lend you money to purchase the vehicle.

Now, if you have a vehicle that is paid in full but it worth a good bit of money, then you want to go for the full coverage car insurance. There are many times however where the situation does not call for all of that coverage.

Say for example the difference between a limited coverage policy and full-coverage is $45 a month. That comes to $540 a year. If you have your policy for two years without an accident, that is a difference of $1,080 between limited coverage and full coverage. If your car only has a resale value of $600, wouldn't it be a wiser move to just get the limited coverage and put the difference in savings? If you totaled your car, which for that value would mean a simple fender-bender, you will only receive the value of your car.

As you can see, not everyone should spend money on the more expensive full coverage vehicle insurance.