What Is Comprehensive Insurance? (2024)

FAQs

What does comprehensive mean in insurance? ›

Comprehensive insurance coverage is defined as an optional coverage that protects against damage to your vehicle caused by non-collision events that are outside of your control. This includes theft, vandalism, glass and windshield damage, fire, accidents with animals, weather, or other acts of nature.

Collision coverage pays for damages to your vehicle that are the result of a collision with another vehicle or a road hazard. Comprehensive coverage pays for other damages to your vehicle such as theft, vandalism, animal damage, falling tree branches and other environmental damage.

What is comprehensive car insurance? In a nutshell, comprehensive car insurance cover – sometimes known as fully comprehensive cover, pays out if you damage your car, someone else's car or injure someone in an accident, regardless of who is at fault. Comprehensive car insurance also covers you against fire and theft.

If you're more likely to get into an accident, you won't want to pay out a higher deductible. However, if you're generally a safer driver, your car insurance premiums will be lower with a $1,000 deductible.

Most car dealerships, banks and other lenders require you to purchase comprehensive insurance if you finance or lease your car. Comprehensive coverage is worth adding to your insurance policy if you're looking for peace of mind and want your car protected in all scenarios.

What To Do When You've Paid off a Financed Car. Once you've paid your vehicle off, you're no longer subject to any insurance requirements other than your state's minimums. If you want to drop some types of coverage to save money, that's up to you.

'Comprehensive' insurance cover provides the widest cover and covers for theft and hijacking, damages due to an accident, fire or explosion and natural disasters like hail and floods.

So, if you live in a location with a high level of theft, weather-related damage or other comprehensive claims, your insurer may compensate for the added risk by raising your comprehensive insurance premiums. Your comprehensive premiums also rise when your insurer raises rates across all types of coverage.

Full coverage auto insurance includes a combination of liability, medical, collision, and comprehensive coverages to protect you in most scenarios that could occur with your vehicle. If you intend to or already have purchased full coverage, it's important to read your insurance contract.

Comprehensive deductibles serve to share auto repair costs from non-collision events. Usually set from $100 to $1,000, it affects premiums and out-of-pocket expenses before insurance coverage kicks in.

What if I can't pay my deductible car insurance? ›

If you cannot pay the full deductible up front after an accident, some repair shops may work with you on a payment plan. If you cannot pay the whole deductible, some shops may not start the repairs right away. Depending on your policy, your insurance company could also refuse to pay until you have paid your portion.

Before you choose a deductible, most insurance professionals recommend you figure out what you can afford to pay if your car is damaged in an accident. If your budget allows for a maximum out-of-pocket expense of $500, you probably should not choose a deductible higher than $500.

A standard rule of thumb in the car insurance sphere is if your annual collision insurance cost surpasses 10% of your vehicle's value, you might contemplate whether to drop collision coverage.

Therefore, based on the value of the car and the potential financial burden of repairs, a person who just purchased a new car would benefit the most from having collision insurance.

After you've paid your deductible, collision coverage helps pay to repair or replace your vehicle up to its actual cash value. Collision coverage is typically required if you owe money on your auto loan or if you lease your vehicle, but if your car is paid off, it's optional.

Comprehensive coverage: Deductibles for comprehensive coverage, which covers damage to the vehicle from a non-driving peril, like extreme weather, theft and vandalism, are typically set at $500 or $1,000. Collision coverage: Drivers can typically choose to pay $500 or $1,000 as their collision deductible.