Does Navy Federal Credit Union require full-coverage auto insurance on all of its car loans?

I'm financing a new car through Navy Federal Credit Union. The loan officer told me I need to have full coverage, which is far more expensive than the liability I had on my old car. Is it normal for lenders to ask for full coverage on an auto loan?

Apr 27, 2021
Answer provided by
Eric Schad
Answered at Apr 27, 2021
“The loan officer is correct. Financed cars typically require full coverage, which includes:
The reason that Navy Federal and other lenders require this is to protect their collateral (the car). If you didn’t have it and the car was totaled, you could easily walk away and the lender would have to eat the loss.
For this reason, you should always budget for full coverage and check car insurance quotes online to make sure you get the best rate possible.”
Car Loans

Did this answer help you?

Ask us a question by email and we will respond within a few days.

Have a different question?

You can meet us at our office and discuss the details of your question.

Easiest way to compare and buy car insurance

No long forms
No spam or unwanted phone calls
Quotes from top insurance companies