When most people walk into an insurance office or call an agent, they often begin the conversation with the same phrase: “I want full coverage.” It sounds reasonable. After all, who wouldn’t want their car, home, or business to be fully protected? The problem is that “full coverage” doesn’t actually exist—at least, not in the way most consumers imagine it. It’s a vague phrase that can lead to costly misunderstandings and dangerous coverage gaps.
Insurance expert Karl Susman, host of The Insurance Hour, explains that “full coverage” is one of the most misleading and overused terms in the industry. Instead of asking for full coverage, he urges consumers to have a clear, detailed conversation about what they want protected, from what, and to what extent.
Below are five practical steps that help you build the right insurance policy—without paying for protection you don’t need or assuming coverage that isn’t actually there.
Clarify Exactly What You Want to Insure
The first and most important step is clarity. Before requesting quotes, take time to think about what you are actually trying to protect. Many people approach insurance with generalities like “I want car insurance” or “I need homeowners insurance.” But every policy is made up of individual components that protect different things.
For example, auto insurance can include liability, collision, comprehensive, medical payments, and uninsured motorist coverage. Home insurance can include dwelling protection, personal property, liability, additional living expenses, and scheduled items such as jewelry or art. Business insurance may involve general liability, property damage, professional errors, cyber protection, or business interruption.
When you simply say “full coverage,” you leave the definition up to the agent, which can lead to missing important protection. Instead, be specific. Say what you actually want insured—your car against theft and vandalism, your home against sewer backup, or your business against lawsuits for professional mistakes. This level of detail ensures your agent understands your priorities and builds a policy that reflects your real life.
Define the Types of Losses You Want Covered
Once you’ve identified what you want to insure, the next step is defining what types of losses you are concerned about. Insurance is about transferring financial risk, but not every risk is covered automatically.
Ask yourself whether you want protection from accidental damage, theft, natural disasters, or lawsuits. Consider whether you need replacement cost coverage or actual cash value coverage. In auto insurance, many people assume “full coverage” means liability, collision, and comprehensive. But it often doesn’t include rental reimbursement, gap coverage, or protection against uninsured drivers—coverages that can be essential.
The same applies to home and business insurance. Floods, earthquakes, and sewer backup are not covered under standard homeowners policies. Unless you specifically request those protections, you may discover after a loss that your “full coverage” didn’t include them at all.
Do Not Assume Your Previous Policy Was Adequate
A major mistake Susman warns against is blindly relying on your most recent policy. Many people simply renew year after year without reviewing what is actually in their coverage. That’s risky for two reasons.
First, your life changes. You may buy new valuables, remodel your home, add a driver, or start working from home. Each of those changes affects your insurance needs. Second, policy forms and carrier rules change over time. Coverage limitations and exclusions may shift without you realizing it.
If you simply tell your agent, “Do what I had before,” you may be carrying forward outdated decisions that no longer make sense. A car that once justified collision coverage may no longer need it due to low market value. A home policy that never included ordinance and law coverage could leave you short if rebuilding under modern building codes is required.
Each renewal should be treated as a fresh evaluation of your risks, not an automatic repeat of the past.
Communicate What Matters Most to You
Insurance is not one-size-fits-all. Some people care most about repairing or replacing physical property. Others are more concerned about liability protection and lawsuits. Your agent cannot tailor a policy to your priorities unless you clearly communicate them.
If your primary concern is being sued after an accident, emphasize liability coverage. If you are most worried about the physical loss of your car or home, say so. If you are a homeowner, explain whether your priority is the structure, your personal belongings, or your personal financial exposure.
This information shapes how limits are structured and which optional protections are recommended. It may also guide your agent toward solutions like umbrella insurance, which offers significant additional liability protection at relatively low cost.
Decide How Much Financial Risk You Are Willing to Accept
Every insurance policy involves a balance between premium and risk. Deductibles—the amount you pay out of pocket before insurance applies—play a key role in that balance.
The higher your deductible, the lower your premium, and the more financial responsibility you assume. Lower deductibles mean higher premiums but less surprise expense after a loss. Your choice should reflect your financial comfort level.
Ask yourself how much you could realistically afford to pay tomorrow if something happened. If you have strong savings, a higher deductible may make sense. If an unexpected repair would strain your finances, a lower deductible may be worth the added cost.
As Susman explains, “The larger your deductible, the more out of your pocket, the less premium you pay.” Understanding this trade-off allows you to design coverage that fits your real financial situation.
Why Clarity Always Beats “Full Coverage”
“Full coverage” is not a product—it’s a misconception. What you truly need is a policy that matches your risks, priorities, and financial tolerance. Vague requests leave room for dangerous assumptions.
To protect yourself properly, be specific about what you want insured, define the losses you want covered, review your policy regularly instead of copying the past, communicate your personal priorities, and choose deductibles based on what you can afford.
When you follow these steps, you avoid costly coverage gaps, reduce unnecessary spending, and create insurance protection that actually works when you need it.
Because in the end, real protection isn’t about having everything—it’s about having exactly what you need.
