Choosing The Right Time For Comprehensive Auto Insurance Coverage

Comprehensive auto 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. It does not cover damage or injuries you cause to others while driving, your own injuries after an accident, damage to your car from a collision with another driver or object, personal belongings inside your car, damage from potholes, or normal wear and tear.

Comprehensive insurance is typically bundled with collision insurance, which covers damage to your car after a crash. Collision coverage pays to repair or replace your car if you accidentally collide with something, such as a car, guardrail, pole or tree.

Whether you need comprehensive coverage depends on 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 might want to forego it.

When is comprehensive insurance worth it?

Comprehensive insurance is worth it if you're seeking peace of mind and want protection for your car in all scenarios. It is particularly useful if you would struggle to cover the cost of repairing or replacing your car in the event of damage or loss.

Comprehensive insurance covers damage to your car from non-collision incidents, such as fires, vandalism, theft, natural disasters, and animal collisions. It is usually bundled with collision insurance, which covers damage to your car from collisions with other vehicles or objects.

Comprehensive insurance is generally required if you lease or finance your car. However, if you own your car outright and have the financial means to cover repairs or replacement, you may decide it's not worth the additional cost. This is especially true if your car is older and has a low value, as comprehensive insurance reimburses you for repairs only up to the car's actual cash value, minus your deductible.

When deciding whether to opt for comprehensive insurance, consider factors such as the age and value of your car, your financial situation, and the risk factors associated with your location, such as extreme weather conditions, natural disasters, high crime rates, or animal collisions.

What does comprehensive insurance cover?

Comprehensive insurance is defined as an optional coverage that protects your vehicle from damage caused by non-collision events outside of your control. It is often required by lenders when you finance or lease a vehicle.

Comprehensive insurance covers damage to your car caused by a variety of accidents that are unrelated to traffic. This includes:

• Weather events such as hail, floods, tornadoes, and wind damage from hurricanes.
• Falling objects, such as tree limbs.
• Theft of the vehicle or its parts, such as airbags.
• Vandalism or civil unrest, such as riots.
• Explosions, fires, and smoke damage.
• Hitting or being hit by an animal, such as a deer.
• Rocks or objects kicked up by or falling off cars.
• Storms, lightning, earthquakes, and other acts of nature.

Comprehensive insurance does not cover damage or injuries you cause to others while driving, your own injuries after an accident, damage to your car from collisions with objects or other drivers, personal belongings inside your car, damage from potholes, or normal wear and tear.

When is comprehensive insurance required?

Comprehensive insurance is required by lenders if you are financing or leasing your car. This is to protect the lender or leasing company in case the car is damaged or written off in a non-collision incident. If you own your car outright, comprehensive insurance is not required by law, but it can be a good idea to add it to your policy for peace of mind.

Comprehensive insurance covers damage to your car from non-collision incidents, such as fires, vandalism, theft, and natural disasters like floods and hail. It also covers collisions with animals and falling objects, such as tree branches. It does not cover damage to another person's property, any medical expenses, or the value of items stolen from your car.

When deciding whether to get comprehensive insurance, consider the value of your car, how you're paying for it, and your financial situation. If your car is worth less than ten times your premium, you may be better off without it. However, if you can't afford to pay for repairs or a replacement car out of pocket, comprehensive insurance could be a worthwhile investment.

How much does comprehensive insurance cost?

The cost of comprehensive insurance depends on several factors, including the value of your car, your deductible, and your location.

The cost of comprehensive insurance is based on the "actual cash value" (ACV) of the vehicle. This is how much the car will cost to replace, minus depreciation. So, cars that are worth more are more expensive to insure. However, the price of your policy will vary depending on your deductible, which is the amount your insurance provider subtracts from a check or your vehicle's value when you file a claim. For example, if you have a $1,000 deductible and your car is damaged in a flood, your insurance provider will send you an amount to repair your vehicle minus $1,000. The higher your deductible, the lower your insurance cost.

Comprehensive insurance coverage cost about $160 a year on average in 2017. However, this number likely includes group policies, which are typically cheaper than individual policies. According to NerdWallet's September 2024 analysis, the median national cost for full coverage insurance, which includes comprehensive and collision insurance, is $1,766 a year. The Zebra reports that the average cost of full coverage auto insurance is $133 per month, with the cheapest rates coming from Travelers ($112/month), USAA ($114/month), and Nationwide ($123/month). Bankrate reports that the average cost of car insurance in the US is $2,348 per year for full coverage and $639 per year for minimum coverage.

What are the pros and cons of comprehensive insurance?

Comprehensive insurance is often required if you lease or finance your vehicle. However, if you can drop the coverage, consider the value of your car and the following pros and cons.

Pros

• Covers a variety of unexpected events, including theft, natural disasters, damage caused by animals, riots, floods, vandalism, and fire.
• Allows for add-on protection, such as special perils coverage for vehicle damage resulting from natural disasters.
• Offers unrestricted claim submissions.

Cons

• Costs more than minimum required coverage.
• Isn't worth the price if your car is older and has little value.
• Won't cover damage to your car caused by a collision or hitting a pothole.
• Does not cover everything, including personal injuries, belongings inside the car, and protection for all drivers.
• Comes with a deductible, a predetermined amount that you agree to pay before your insurance company compensates for losses.

Frequently asked questions