Whether you’re shopping for car insurance for the first time or just trying to get the best rate for your policy, you may have some questions about the coverage options available to you. For instance, what are comprehensive and collision coverage insurance? What’s the difference? Do you need them?
Let’s take a look at the difference between these two types of auto insurance coverage, so you can better understand whether these insurance policy options are right for you.
Your Car Insurance Policy Options
In most states, you’ll be required to carry several types of insurance on your vehicle in order to register it. These include:
- Property damage liability protection
- Bodily injury liability coverage
- Uninsured and underinsured motorist property damage liability
- Uninsured and underinsured motorist bodily injury liability coverage
In some cases, you may also need personal injury protection (PIP). These are just the state minimum requirements; you’ll have other coverages available to you.
In fact, as you shop around for the right auto insurance policy, you’ll likely notice that there are two additional options that may significantly raise your premium when added: comprehensive insurance and collision insurance. What are these two auto insurance coverage types and how do they protect you? Let’s take a look.
Collision Coverage Insurance
Collision coverage insurance is exactly what it sounds like. If you’re in an accident and you damage your car, collision coverage has you protected.
- You’re driving down the highway and lose control as you hydroplane. You skid off the road and into a signpost. Collision insurance covers this.
- You’re in a poorly maintained part of town and you hit a giant pothole, damaging your struts and throwing off your suspension. Collision coverage was made for this.
- You and another driver are backing up in a parking lot at the same time and “kiss bumpers.” Collision insurance will pay for this.
- You’re involved in, or at fault for, a two (or more) car accident on the freeway. Your collision coverage will pay for the damage.
In summary, collision coverage insurance covers you if you hit another vehicle or object, if your vehicle rolls over, or if another vehicle hits you.
Comprehensive Coverage Insurance
Comprehensive insurance is slightly different than collision. You can think of it, in a way, as covering something that happens to your vehicle passively. Here are a few examples:
- You’re vacationing in Kansas, a tornado hits, and an uprooted tree crashes through your windshield.
- You’re driving down the parkway one evening and a deer jumps into the road, colliding with your vehicle.
- Some neighborhood hoodlums showcase their talent with spray paint… all over your vehicle.
- You think you’ve forgotten where you’ve parked at the mall, but it turns out your vehicle has been stolen.
To put it very simply, comprehensive coverage pays for the damage to your car that’s caused by nature and vandalism. You are generally not “at fault” in an event covered by this type of insurance.
Do I Need Comprehensive and Collision Coverage Insurance?
In some cases, you may be required to get comprehensive and collision coverage insurance. The most common instance of this is if you’re financing your car. In a lease or loan situation, the bank will likely require that you carry both types of insurance for the duration of the financing term.
If you own your car outright, these coverages may still be appropriate for you. As you shop for your insurance, it’s important to consider what you can afford, and what you can’t afford.
Put a different way, adding comprehensive auto insurance and collision coverage to your policy will raise your premiums, sometimes significantly. Can you afford this each month?
Conversely, can you afford not to? In the event that your vehicle is totaled or stolen, can you afford to replace it? What is your car worth? Can you afford to pay for necessary repairs out of pocket? To replace it without full coverage?
Do you commute long distances? More time on the road equals a higher likelihood of an accident. Finally, where are you commuting to and from? Is your area prone to high crime or likelihood of storms? Consider hail, sleet, hurricane, flooding, and more as you assess your risk.
As always, check with an insurance agent you trust to help identify areas of risk and determine whether comprehensive and collision coverage insurance is right for you.
Conclusion: Comprehensive and Collision Insurance
Life has risks, and car ownership certainly comes with its share of risk as well. Protect your investment with the proper insurance coverage. Comprehensive and collision coverage insurance can help cover the cost of repairs or replacement should the unexpected happen to your vehicle.
Look at your options, take with your agent, and discover which options are best for you. Both collision and comprehensive insurance might be necessary if you have a new car and want complete auto coverage to ensure you’re not out of pocket, but you can probably skip these both of them if you’re driving a cheap car.