Orlando Harmon
Comprehensive car insurance is an optional coverage that assists with payments to repair or replace your vehicle in incidents of theft or non-collision damage. Comprehensive coverage, which protects your car from damage caused by unexpected events, includes a deductible that applies every time you file a comprehensive claim. The deductible is defined as the amount you pay out of pocket to repair or replace your vehicle after your claim is approved. The remaining approved costs are covered by your insurance company (up to the actual cash value of your vehicle).
| Characteristics | Values |
|---|---|
| What is covered | Damage caused by fire, wind, hail, flood, theft, vandalism, falling objects, and hitting an animal |
| What is not covered | Damage to another person's property, any medical expenses, the value of items stolen from your car, collision with another vehicle, collision with a road hazard, tree or guardrail, damage resulting from your car being flipped |
| Cost | The cost of comprehensive insurance depends on factors such as age, driving record, vehicle, state, and deductible. The average annual comprehensive insurance premium for drivers in the U.S. in 2019 was $171.87. |
| Deductible range | $100 to $2,500 |
| Relationship between deductible and premium | Higher deductible leads to lower premium, and lower deductible results in higher premium |
What You'll Learn
- Comprehensive insurance covers theft, vandalism, natural disasters, and collisions with animals
- Comprehensive insurance is optional unless you lease or finance your vehicle
- Comprehensive insurance doesn't cover damage to another person's property or medical expenses
- Comprehensive insurance is relatively inexpensive and can be purchased separately
- Comprehensive insurance covers the maximum amount based on the actual cash value of your vehicle minus your chosen deductible
Comprehensive insurance covers theft, vandalism, natural disasters, and collisions with animals
Comprehensive insurance is an optional coverage that helps pay for the cost of damages to your vehicle when you're involved in an accident that's not caused by a collision. This includes theft, vandalism, natural disasters, and collisions with animals. For example, if you hit a deer while driving, comprehensive coverage will cover the damage. However, if you swerve to miss the deer and hit a tree, this type of accident is considered a collision with an object, and comprehensive coverage does not apply.
Comprehensive coverage is often referred to as "other than collision" coverage. It covers a range of situations, including theft, vandalism, hail, and animal collisions. It is important to note that comprehensive insurance will not cover any personal items within the car if they are stolen during a vandalism incident. Coverage for personal belongings would typically come under renters or homeowners insurance.
Comprehensive insurance also covers damage from natural disasters, such as fires, floods, and falling objects. It is worth noting that comprehensive insurance does not cover mechanical failure or damage caused by it, as this would be covered by mechanical breakdown insurance.
Comprehensive insurance is typically purchased in addition to liability insurance and collision coverage. While it is not mandatory, most lenders will require you to have comprehensive coverage if you finance or lease your car. It is also worth noting that comprehensive coverage does not include a deductible, and you will be responsible for paying your selected deductible amount before your insurance company pays for the remaining approved costs.
Gap Insurance Tax in Pennsylvania
You may want to see also
Comprehensive insurance is optional unless you lease or finance your vehicle
Comprehensive insurance is typically optional if you own your vehicle. However, if you lease or finance your vehicle, your lender will likely require you to purchase it. This is because comprehensive insurance covers damage to your car from non-collision events, such as fires, vandalism, natural disasters, or even hitting a deer. It also pays to replace your car if it's stolen.
Comprehensive insurance is particularly useful if you have a newer car and want to protect your finances in case of theft or damage. If you can't afford to pay for expensive repairs or replace your car, comprehensive coverage may be a worthwhile investment. It's also a good idea if you live in an area prone to natural disasters or vandalism.
On the other hand, if you have an older car with a low market value, comprehensive insurance may not be worth the cost. In this case, you might consider skipping comprehensive coverage to lower your car insurance premium. You may also want to consult the Kelley Blue Book to see how much your car is worth, as comprehensive insurance might cost more than the car itself.
When deciding whether to purchase comprehensive insurance, consider the value of your car, your budget, and the likelihood of needing to make a claim. Additionally, keep in mind that comprehensive insurance has a deductible, which is the amount you pay out of pocket before your insurance company covers the rest. The deductible amount you choose will impact your out-of-pocket costs and your insurance rate.
Open Claim: New Auto Insurance?
You may want to see also
Comprehensive insurance doesn't cover damage to another person's property or medical expenses
Comprehensive insurance is an optional coverage that helps protect your vehicle from damage caused by unexpected events that are not collisions. It covers losses like theft, vandalism, hail, and hitting an animal. For example, if you hit a deer while driving, the damage would be covered under comprehensive coverage. However, if you swerve to miss the deer and hit a tree, this type of accident is considered a collision with an object and is not covered.
Comprehensive insurance does not cover damage or injuries caused to another person or their property while driving. It also does not cover your own injuries after an accident. If you want coverage for damage or injuries caused to another person or their property, you will need liability insurance.
Comprehensive insurance also does not cover damage to your car from a collision with another vehicle or object. For this, you will need collision coverage. Additionally, comprehensive insurance does not cover personal belongings inside your car or damage from potholes. Normal wear and tear are also not covered by comprehensive insurance.
The cost of comprehensive insurance varies depending on factors such as the value of the vehicle, the location, and the driver's insurance history. The deductible for comprehensive insurance, which is the amount you pay out of pocket before the insurance company starts paying for damages, can range from $100 to $2,500. The higher the deductible, the lower the insurance rate, but this also means you will pay more out of pocket if you need to make a claim.
Volcanic Eruptions and Auto Insurance: What's Covered?
You may want to see also
Comprehensive insurance is relatively inexpensive and can be purchased separately
The cost of comprehensive insurance varies depending on factors such as the value of the vehicle, the zip code where it is registered, and the driver's past insurance history. The average cost of comprehensive insurance is around $134 per year but can be nearly double that in certain states. Comprehensive insurance deductibles typically range from $100 to $2,500, depending on state laws and insurance company guidelines.
If you own your vehicle outright, comprehensive insurance is optional. However, if you finance or lease your vehicle, your lender will likely require you to have comprehensive coverage. Even if comprehensive insurance is not required, it may be a good idea to add it to your policy, especially if you have a new car or a high-value vehicle. Comprehensive insurance provides peace of mind and protects your vehicle in various scenarios.
Loyalty Discounts: Do They Apply to Auto Insurance?
You may want to see also
Comprehensive insurance covers the maximum amount based on the actual cash value of your vehicle minus your chosen deductible
Comprehensive car insurance is an essential financial safeguard that covers various risks beyond standard collision car insurance policies. It protects yourself, your passengers, and your vehicle from hazards like theft, animal collisions, glass damage, falling objects, vandalism, fire, floods, and other severe weather damage. When purchasing comprehensive coverage, you will typically be required to select a deductible, which is the amount you will need to pay out of pocket before your insurance provider covers the remaining costs.
The deductible for comprehensive car insurance is a crucial factor to consider when choosing a policy. It is defined as the amount you pay towards repairs or replacing your vehicle after your claim is approved. The deductible is subtracted from your claim payment, and your insurance company covers the remaining approved costs up to the actual cash value of your vehicle. For example, if you have a $500 comprehensive deductible and your car is worth $5,000, and you incur $2,900 worth of damage, you will pay the $500 deductible, and your insurer will cover the remaining $2,400.
The comprehensive deductible amount you choose will impact your out-of-pocket expenses and your car insurance rate. Typically, comprehensive deductibles range from $100 to $2,500, depending on state laws and insurance company guidelines. A lower deductible will result in higher insurance rates, while a higher deductible will lead to lower rates. It's important to strike a balance between your budget, the value of your vehicle, your savings, and the likelihood of filing a claim when selecting a deductible.
It's worth noting that comprehensive coverage has payout limits. The maximum amount your comprehensive insurance will pay out is equal to the current market value of your vehicle minus your chosen deductible. Therefore, selecting a deductible close to your car's actual cash value may not be cost-effective. For instance, if your car is worth $2,200 and you choose a $2,000 deductible, the maximum payout you can expect is $200.
Comprehensive insurance provides valuable protection against unforeseen events and covers a range of scenarios outside your control, such as natural disasters, vandalism, falling objects, and collisions with wildlife. It's essential to consider the common hazards in your area when choosing a comprehensive deductible. If you live in an area prone to such hazards, opting for a lower deductible can be beneficial as you may be more likely to file a claim. On the other hand, if your area is not susceptible to these risks, a higher deductible may be more suitable.
Auto Insurance: Who Needs to Be Covered?
You may want to see also
Frequently asked questions
A comprehensive car insurance deductible is the amount you pay out-of-pocket to repair or replace your vehicle after a claim is approved. The remaining approved costs are covered by your insurance company, up to the actual cash value of your vehicle.
When you file an approved comprehensive claim, you pay the deductible amount, and the insurance company covers the remaining costs, up to your vehicle's value. For example, if you have a $500 deductible and file a claim for $1,000 worth of damage, you'll pay $500, and the insurance company will pay the remaining $500.
The right comprehensive deductible amount depends on your preferences and needs. A lower deductible saves you money on out-of-pocket repair costs but usually results in a higher insurance rate. On the other hand, a higher deductible typically leads to a lower insurance rate but means you'll pay more out of pocket for repairs.
When choosing a comprehensive deductible, consider your financial situation, the value of your vehicle, your driving environment, claim history, risk tolerance, premium savings vs. deductible, emergency funds, driving frequency, and natural disaster risks in your area.
