Auto Insurance: Is Comprehensive Coverage Mandatory?

Comprehensive insurance is an optional coverage that assists with payments to repair or replace your vehicle in incidents of theft or non-collision damage. It covers damage to your car caused by a variety of accidents that aren't traffic-related, such as weather events, falling objects, car theft, vandalism, or civil disobedience. Comprehensive insurance is not required by state law, but if you lease or finance your vehicle, your lender may require that you purchase a comprehensive policy until the end of your lease or until your vehicle is paid off.

When is comprehensive auto insurance required?

Comprehensive auto insurance is not required by law, but it may be mandatory in certain situations. If you are leasing or financing your vehicle, your lender will likely require you to carry comprehensive insurance until your lease ends or your vehicle is paid off. This is to protect their investment in the car.

Comprehensive insurance covers damage to your car from non-collision events such as fires, vandalism, animal collisions, natural disasters, and theft. It is worth noting that comprehensive insurance does not cover damage to another person's property, medical expenses, or legal fees.

Even if comprehensive insurance is not required in your situation, it may still be a good idea to add it to your policy for peace of mind. This is especially true if you have a new car or a high-value vehicle, or if you live in an area prone to extreme weather, car theft, or vandalism.

On the other hand, if you have an older car with a low value, comprehensive insurance may not be worth the cost. In this case, you may want to consider whether you could afford to repair or replace your vehicle out of pocket if necessary.

What does comprehensive auto insurance cover?

Comprehensive auto insurance covers damage to your car from non-collision events, such as natural disasters, theft, vandalism, and accidents involving animals. It also covers damage caused by falling or projectile objects, such as trees, branches, or hail.

Comprehensive insurance typically does not cover damage to another vehicle, medical expenses, legal expenses resulting from an accident, or personal property stolen from your vehicle. It is important to note that coverage can vary by insurer and state, so it is always a good idea to check with your insurer to understand the specific details of your policy.

Comprehensive auto insurance is optional if you own your vehicle outright. However, if you finance or lease your vehicle, lenders will likely require you to have comprehensive coverage to protect their investment. This type of coverage can give you peace of mind, knowing that you are protected against unforeseen events that are outside of your control.

The cost of comprehensive insurance varies depending on factors such as the age and value of your car, your driving record, and your chosen deductible amount. When deciding whether to add comprehensive coverage to your policy, consider the value of your car, your financial circumstances, and your personal preferences.

What doesn't comprehensive auto insurance cover?

Comprehensive auto insurance is an optional coverage that protects your vehicle from damage caused by non-collision events outside your control. While comprehensive insurance covers a wide range of incidents, there are some important exclusions to what it covers.

Comprehensive auto insurance typically does not cover:

• Damage to another vehicle: Comprehensive insurance only covers damage to your own vehicle, not to another person's property.
• Medical expenses: Any medical costs for you, another driver, or passengers are not covered by comprehensive insurance.
• Legal expenses: This type of policy will not cover legal fees resulting from an accident.
• Personal property stolen from your vehicle: Comprehensive insurance will not reimburse you for personal belongings stolen from your car.
• Damage caused by collisions: Comprehensive insurance does not cover damage to your car from colliding with another vehicle or object. This includes pothole damage.
• Normal wear and tear: Regular maintenance and wear and tear on your vehicle are not covered.

It's important to note that coverage can vary by insurer and state, so always check with your insurance provider to understand the specific exclusions and limitations of your policy.

How much does comprehensive auto insurance cost?

The cost of comprehensive auto insurance varies depending on several factors, including age, driving record, location, vehicle type, and insurance company. According to the National Association of Insurance Commissioners (NAIC), the average annual comprehensive insurance premium for drivers in the US in 2019 was $171.87. The cost ranged from $96.53 in California to $347.61 in South Dakota.

Comprehensive insurance is an optional coverage that helps pay for repairs or replacement of a vehicle in the event of theft or non-collision damage. It is typically recommended for newer or more valuable vehicles, as it covers a variety of unexpected events such as weather events, falling objects, car theft, and vandalism.

The cost of comprehensive insurance can be reduced by choosing a higher deductible, which is the amount paid out of pocket before the insurance company covers the remaining expenses. A higher deductible will result in a lower insurance premium. However, it is important to weigh the potential insurance payout against the deductible amount, as a higher deductible may result in higher out-of-pocket costs if the vehicle is damaged.

When deciding on comprehensive insurance, it is important to consider the value of the vehicle, the likelihood of needing repairs or replacement, and the desired level of coverage. Comprehensive insurance is often required by lenders for leased or financed vehicles.

Is comprehensive auto insurance worth it?

Comprehensive auto insurance is optional coverage that assists with payments to repair or replace your vehicle in incidents of theft or non-collision damage. It is not required by law in any state, but it's usually required by lenders if you are leasing or financing your vehicle.

Comprehensive insurance covers damage to your car caused by a variety of accidents that aren't traffic-related. This includes damage caused by weather events, such as hail, floods or tornadoes; falling objects, such as tree limbs; car theft and broken windows; and vandalism or civil disobedience, such as a riot.

Whether or not comprehensive insurance is worth it for you will depend on several factors. These include the value of your vehicle, how you're paying for it, and your overall financial situation. If you have an auto loan or are leasing your car, you will probably be required to get comprehensive coverage. If you don't have cash for repairs, comprehensive coverage could be helpful. But if your car is worth less than ten times your premium, you may be better off without it.

If your vehicle's cash value is relatively low and you have a higher deductible, for example, it may not be worthwhile to carry comprehensive coverage. On the other hand, it may be worthwhile if your vehicle has a high cash value, or you cannot afford the cost to repair or replace your vehicle out of pocket. If you prefer to be covered against any unforeseen events, then comprehensive insurance may help give you peace of mind.

Frequently asked questions