Comprehensive insurance is one of the protections plans you’ll need if you want full coverage vehicle insurance. But do you know how it works? Read on to find out.
If you’re shopping for car insurance or examining your current policy, you might want to consider adding comprehensive coverage. Let’s take a look at what comprehensive insurance means, why you might need it, and the things it covers. We’ll also look at some affordable, comprehensive insurance providers.
What is comprehensive insurance?
Comprehensive coverage is an optional protection plan that insurance companies offer for an extra charge. It helps pay for the replacement or repair of your car if it is stolen or damaged in an incident that’s not a collision.
What does comprehensive car insurance cover?
Comprehensive car insurance, sometimes known as “other than collision,” typically covers damage caused by the following events:
- Natural disasters like floods and hurricanes
- Theft and vandalism
- Fire
- Falling objects, such as a tree or a pole.
- Civil disturbances such as riots
- Hitting an animal
- Damage to your car’s windows
If you plan to finance or lease a new car, your lender will almost certainly require full coverage. However, if you own your vehicle outright, comprehensive insurance is optional for your policy.
What does comprehensive auto insurance not cover?
It does not cover
- Damage to your car from a collision
- Medical expenses of either party involved in an accident.
- Legal fees and lost wages if you miss work after an accident.
- Damage to another person’s car due to a collision.
- Valuables were stolen from your car.
If you have opted for comprehensive car insurance, you are likely to have collision coverage, too. Collision insurance covers damage to your vehicle caused by a collision with another vehicle or an object. It also covers accidents in which your vehicle rolls over. To know more about collision insurance, head here.
What is a comprehensive deductible?
A comprehensive deductible is an amount you agree to pay before your insurance company begins to pay for any damages. You might think of it as the amount of financial risk you’re willing to accept in the event of an accident.
Comprehensive car insurance limits and deductibles
Your deductible is the amount you pay out of pocket before your car insurance starts covering the rest. Once it’s paid, your insurer covers the remaining expenses up to your policy’s limit. When you buy comprehensive insurance, you’ll be asked to choose a deductible amount.
Let’s say your vehicle needs $6,000 in repairs and your deductible is $1,000. You would pay the $1,000, and your insurer would handle the remaining $5,000. Choosing a higher deductible will eventually help you lower the premium, but make sure you have enough saved to cover that amount if something happens.
Comprehensive coverage also comes with a limit. Usually, the actual cash value (ACV) of your car. This is the maximum your insurer will pay for a covered claim. For instance, if your car gets stolen, the payout will reflect its depreciated value minus your deductible. So, if you plan to replace it with a newer model, you’ll likely need to cover the difference yourself.
Keep in mind that your comprehensive deductible and limit are separate from the collision deductible and limit in your policy.
Is comprehensive insurance mandatory?
In many states, basic car insurance includes property damage liability, bodily injury liability, and uninsured or underinsured motorist coverage. Some states also require personal injury protection (PIP). However, comprehensive insurance is not mandatory as part of basic coverage in any state.
Still, skipping comprehensive coverage isn’t always a good idea. If your car is damaged by a fire, natural disaster, or similar event and you don’t have this coverage, you’ll be responsible for all repair costs out of pocket. While minor body damage may only cost a few hundred dollars to repair, fixing critical systems such as the engine or suspension could cost thousands of dollars.
In general, obtaining both comprehensive and collision insurance is a good idea because the possible advantages could well surpass the expense.
Where can I find the best collision coverage for my car?
All major insurers offer comprehensive coverage as an optional add-on to your car insurance policy. It is one of the basic coverages available, including liability, collision, medical payments, personal injury protection, and uninsured/underinsured motorist coverage.
Our team of analysts sought quotations from five different insurance providers to get the most realistic costs for a plan that includes comprehensive coverage. We found that adding comprehensive coverage to your policy could raise your monthly premium by $150 to $200, depending on the state and your insurer.
We found the most affordable quotes from Progressive and State Farm among the major insurance providers, followed by Allstate. However, your car insurance quotes could vary as they are calculated using several criteria. They include your age, gender, location, credit score, and driving history, among others. The best way to find the most affordable car insurance quotes for your needs is to shop around and obtain several quotes online.
Renée Martin is a travel and car expert who focuses on road and air travel in the U.S. For the past 6 years, she’s been helping make driving and trip planning easier and budget-friendly for everyday travelers.
