Full coverage auto insurance is a policy that includes not only liability insurance and other mandatory benefits, but also collision and comprehensive insurance.
Collision insurance is one part of full a coverage policy. It pays you when your car is damaged in a collision as you might expect. Collision insurance does not pay the other driver for damage to his or her car or to his or her body. This is covered by the liability portion of your policy.
Collision insurance not only pays for collisions with other cars, it also pays when your car strikes a fixed object. It can pay when you hit a pothole also.
Comprehensive or other than collision is another part of full coverage. This pays for damage caused by fire, flood, falling objects, theft and glass breakage among other perils.

These optional aspects of your auto insurance policy are optional because they do not impact what your policy pays to other people. This is a good thing because you may not want to buy collision insurance on an older car if you can afford to buy a new one without the insurance company’s help. Since the insurance company will only pay you the depreciated value of your car, you may be better off with a lower insurance rate even though it means that your exposure is higher than it would be otherwise.

You may want full coverage auto insurance on a new car, but it may be wise to reduce your premiums by having a medium size or larger deductible. It rarely pays to have the lowest deductible available for your auto insurance since this adds so much to your premiums.