Comprehensive Vs Collision Auto Insurance

While the foundation of car insurance is liability insurance, there are other important components to consider. Most importantly, you should be able to cover any damages you cause to others with liability insurance. On the other hand, comprehensive and collision will do something liability can’t do – that’s compensating you if your car is stolen.

Comprehensive and Collision Coverage

Comprehensive cover non-crash damages.  In other words, if a tree falls on your car, your car catching on fire, running into an animal, or getting stolen, comprehensive will cover it.  It basically covers the unexpected. Collision will cover crash-related damages such as when you hit an object or another vehicle. Collision and comprehensive are generally sold together as a package by insurance companies.

What’s A Deductible?

Both collision and comprehensive have deductibles. If you are involved in a crash, your claim will be reduced by the deductible amount. The most common deductibles are $250 to $1000 and even higher. Some insurance companies may offer better deductibles than others to their clients to compensate them for good driving. Deductibles tend to go down over time if you don’t have some specific claims.

Maximum Payout

The maximum insurance payout for both comprehensive and collision is the value of your vehicle before the accident took place when it’s totaled minus your deductible. A vehicle is considered totaled when it can be repaired and it’s safe to drive it when repairs will cost more than your car’s value or surpass a specific percentage of your car’s value. Many states consider a car totaled when the repairing costs exceed 75% of the vehicle’s value. New cars aren’t that difficult to be totaled since the technology is very costly to repair, so cars are most likely to be totaled in a crash.

Do I Need Both Comprehensive and Collision?

If you have a lease, you may be required to purchase both comprehensive and collision. It’s designed to prevent the leaser from walking away from a lease or loan if a vehicle were totaled or stolen. After your loan or lease has been paid, comprehensive and collision will most likely become optional. However, you may still need it, especially if you can’t cover the repairs or can’t purchase another car if your car were damaged or stolen. Comprehensive and collision can offer the financial protection you need during such times. If your car is older, you may not need comprehensive and collision since the value of your vehicle decreases over time, so the maximum insurance payout will be much less as well, particularly if your deductible is high.

According to recent data by the National Association of Insurance Commissioners, the average cost for collision is $342.40 a year and comprehensive is $153.32. keep in mind, collision and comprehensive won’t cover injuries sustained in an accident – these are generally covered either by the driver’s liability insurance or our own health insurance. Items stolen from your vehicle may not be covered except by your homeowners or renters insurance.

Looking for affordable car insurance?  Request a quote here. 

Sources
  • https://www.doi.sc.gov/588/Automobile-Insurance

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