What Is Comprehensive Auto Insurance?

January 28, 2021

What is Comprehensive Auto Insurance?

As a car owner, you likely already know the importance of car insurance. However, what many people do not realize is that there are several types of car insurance available.

One of the most important types of car insurance is comprehensive car insurance. This type of car insurance is also known as ‘other than collision’ insurance. 

Comprehensive car insurance provides insurance coverage in the case of damage to your car that results from incidents that are not collisions or accidents. For example, if your roof is damaged due to hail, this insurance will help cover the cost of repairs. 

What does comprehensive insurance cover?

Comprehensive auto insurance covers damages that are a result of:

  • Theft 
  • Vandalism
  • Falling objects
  • Civil disturbances, like riots
  • Natural disasters, like hail, hurricanes, and tornadoes
  • Accidents that arise due to hitting an animal like a deer
  • Fire 

This insurance policy does not cover:

  • Damage that results from collisions with another vehicle or stationary objects
  • Legal fees
  • Medical expenses
  • Damage to another person’s vehicle as a result of a collision
  • Lost income due to work missed as a result of an accident
  • Property that was stolen from your car

Comprehensive auto insurance helps cover damage costs up to the actual cash value (ACV) of your car, minus any deductible. This insurance policy is completely optional. However, if you are financing or leasing a car, you may find that your lender will require you to carry this insurance.

Collision vs. Comprehensive Insurance

Another common form of car insurance is collision insurance. Like comprehensive car insurance, collision insurance also covers damage done to your car, which makes it easy to confuse with comprehensive car insurance.

However, collision insurance covers damages resulting from your car colliding with another vehicle or object, like a tree or a fence. It does not cover damages from theft, natural disaster, and other non-collision incidents.

Do I Need Comprehensive Auto Insurance?

As comprehensive auto insurance is an additional, optional policy, many car owners may feel that carrying this policy is unnecessary. Choosing not to carry this policy can help save on deductible costs. 

However, dropping this policy is not always advantageous. These are many situations in which this policy can actually help save you money in the long-term. 

Some situations in which you should carry comprehensive auto insurance include:

  • If you live in a heavily populated area or in an area that has high crime rates. In such situations, comprehensive car insurance can help provide financial protection in the case of theft.
  • If you live in an area that has a lot of natural disasters. For people who live in areas that see a lot of wildfires, or on the Florida coast, for example, carrying comprehensive auto insurance can help protect against the risk of damage to their vehicles.
  • If you cannot afford to repair or replace your car. If an unexpected disaster will leave you without a car, carrying comprehensive car insurance is essential. This policy will help ensure that you will be able to fix your car in the case of severe damage without it setting you back financially.

At the same time, comprehensive car insurance is not necessary for all car owners. For example, if your vehicle is worth less than what you would pay for your insurance premiums, it is likely that this policy will not make financial sense to carry.

How much does the comprehensive car insurance cost?

Several factors influence how much your comprehensive car insurance will cost. These factors include:

  • Your driving history. An insurer takes into consideration how likely it is that you will be filing an insurance claim. If you have a history of filing claims or have several accidents on your driving record, you are considered an insurance risk, and your premiums will reflect this fact and may be higher.
  • Car’s model and age. Your insurer will account for how much your car will cost to repair or replace. The more expensive a car will be to repair, the higher the insurance premiums will be.
  • Your deductible. Your deductible is the amount that you pay on your insurance claim before your insurance coverage kicks in. Your insurance will cover the rest of your costs, up to your limit. Higher deductibles mean lower premiums. However, the greater your deductible, the more out-of-pocket expenses you will have in the case of damage to your car.

How do I choose a deductible amount?

When buying comprehensive auto insurance, you should base your deductible on your car’s actual cash value (ACV). 

The ACV of a car is determined by comparing it to the values of similar vehicles in the area in which you live. Comprehensive car insurance helps you repair or replace your car based on the ACV. Essentially, if the cost of repairing the damage to your car is under the ACV, the insurer pays out the amount. However, if the cost is higher than the ACV, they will pay you the sum of the ACV so you can replace your car. 

There are several online calculators available to approximate what the ACV of your car is. Your insurance provider will also help you determine this amount when you apply for comprehensive car insurance.

How can I find the right comprehensive car insurance provider?

With the number of insurers available on the market, finding the right insurance provider can be challenging. Not only do you need to ensure that you are getting the most benefits possible, but you also want to try and keep the cost of your premiums as low as possible.

If you’re looking to purchase comprehensive coverage, there are several ways you can go about finding the right insurance provider. One option is to speak to an independent insurance agent who can help you shop for the right plan for your vehicle. 

However, you can also find the right option on your own. A fast and easy way to find the perfect insurance provider for your needs is to compare comprehensive car insurance quotes from multiple insurance carriers. 

You can do this by using a website like OfficialCarInsurance.com, which helps you approximate what your premium costs will be, depending on your car, personal driving history, and several other factors. This saves you the time and money that you would spend with an independent agent and allows you to find the right insurance provider quickly and easily.