What Is Covered by Collision and Comprehensive Car Insurance?
Besides liability insurance, collision insurance and comprehensive insurance are the two most common types of automobile insurance. While collision and comprehensive insurance both pay for damage to a vehicle, the type of damage each policy covers is different.
Collision Car Insurance
Collision insurance covers damages incurred from a collision with another vehicle, regardless of who is at fault. Some of the events often covered by collision insurance are:
A collision with another vehicle.
A crash with an object like a fence, tree, or pole.
The vehicle rolls over.
Damages sustained from hazards like potholes.
Collision into a building, garage door, or similar structure.
Comprehensive Car Insurance
Comprehensive insurance helps cover damage to your car that is not the result of a collision, such as damage from theft, fire, or vandalism. Damage comprehensive insurance often covers includes:
Damage caused by fire.
Damage incurred as a result of a natural disaster like a flood or a hurricane.
Falling objects like a tree.
Damage resulting from theft or break-in.
Vehicle damage incurred as part of a civil disturbance like a riot.
Damage in an accident with animals.
Additional Features of Comprehensive and Collision Insurance
Comprehensive and collision insurance typically pays for damages up to the vehicle’s actual cash value (ACV). ACV is calculated by subtracting depreciation from the replacement cost of the vehicle.
Additionally, both types of insurance generally have a deductible. The policyholder is responsible for paying the deductible. The amount the insurance company will pay for a claim is reduced by the amount of the deductible when the claim amount exceeds the deductible. For example, if the damage to a vehicle is $2,000 and the policy has a $500 deductible, the insurance company will pay $1,500, and the policyholder pays $500.
Should You Buy Collision Insurance, Comprehensive Insurance, or Both?
In general, collision and comprehensive insurance cover different types of damage. Thus, having both kinds of insurance offers the best protection from damage to a vehicle.
Some factors that can affect the decision whether to buy one or both types of insurance include:
Repairs costs: high-value cars can be expensive to repair no matter what may cause the damage.
Those who drive many miles each month have a greater risk of being in an accident.
Different geographic areas where the vehicle is parked have different risks. For example, areas with a high crime rate have an increased risk of a claim. Likewise, areas with low crime rates but frequented by severe weather can increase the risk of a claim.
Paying for car damage can be challenging for drivers.
Although collision and comprehensive car insurance are not required by state law, companies that lease or finance vehicles generally require both types of coverage. The combination of collision and comprehensive coverage provides drivers with the most extensive protection against loss. Therefore, many drivers purchase both types of insurance.
ABC Dennis Insurance
ABC Dennis Insurance is an independent insurance agency established in 1997 that provides automobile insurance to its customers. If you have not reviewed your insurance coverages this year, please call our office at (813) 949-7765 or email us.
Besides auto insurance, we can help with all your insurance needs. As an independent agency, we find the best insurance coverage with the most competitive rates.