The type of insurance coverage required for your vehicle is determined by the amount you owe on the loan. If the loan balance is less than $2,500, you can choose what type of coverage you want, including liability only, which only covers repairs or loss caused to another vehicle. If the loan amount owed is more than $2,500, you are required to carry full coverage with a maximum deductible of a $1,000. Until the loan is paid off, the vehicle is considered collateral for the loan and must be protected accordingly.