Car insurance consists of several different policies. Two of the most popular policies are collision coverage and comprehensive coverage. Collision coverage pays for accident-related vehicle damage, and comprehensive coverage pays for damage caused by incidents other than an accident.
Almost every car insurance company offers both types of optional coverage. If you’re considering whether to purchase comprehensive or collision insurance, this article is for you. Keep reading to learn the key differences between comprehensive vs. collision insurance, what each covers, and how much these policies cost.
What is Comprehensive Insurance
Comprehensive coverage is a car insurance policy that covers vehicle damage unrelated to an accident. Despite the name, comprehensive insurance doesn’t protect your vehicle from any damage. However, it does cover many hazardous situations that could cause damage or even total your car.
There are a few reasons why drivers should consider purchasing comprehensive insurance. For one, it’s the only car insurance policy that covers vehicle theft. If your car gets stolen or damaged by a covered peril, your insurance company will reimburse you for the cost of repairs, or give you money to buy a new car.
Here are some of the situations covered by a comprehensive insurance policy:
- Weather-related damage
- Falling objects
- Hitting an animal
What is Collision Insurance
Collision insurance is exactly what the name suggests: a type of insurance that pays to repair damages to your vehicle after an accident. Collision coverage is paid regardless of who caused the crash. Typically, collision coverage can only be purchased with comprehensive and liability insurance. Accidents can happen at any time, so collision insurance is one of the most important coverages a driver can have.
If you get into an accident, you submit a claim with your insurance company, and once approved, you receive a check for the cost of repairs. If your car is totaled in a crash, your insurance company will help you purchase a replacement. Here are the situations that would be covered with collision insurance:
- An accident with another driver
- Collision with a stationary object, like a pole or guard rail
What Is Not Covered by Comprehensive and Collision Insurance?
Collision and comprehensive insurance provide important protection for your vehicle, but they don’t cover everything. For instance, comprehensive and collision coverage don’t provide liability protection if you hit another driver or cause property damage. Additionally, these policies won’t pay for medical bills if you or a passenger get injured in a crash.
Here are some situations that are not covered by comprehensive or collision insurance, and descriptions of what policies would apply:
- Your medical expenses after an accident — If you get into an accident and you or a passenger suffer injuries or need medical attention, medical payments coverage would cover the costs.
- Other driver’s medical expenses — If you cause an accident and the other driver gets hurt, liability coverage would cover their medical expenses.
- Your personal items inside a stolen vehicle — If your car gets stolen, you would need to have home insurance or renters insurance to be compensated for stolen personal items.
- Property damage you cause — If you cause property damage in an accident, liability coverage would cover the cost of repairs.
- Your legal fees if you get sued — If another driver sues you for vehicle damage, bodily injury or property damage, liability insurance would cover the cost of attorney fees, court costs, and settlements.
How Much is Comprehensive and Collision Insurance?
Comprehensive insurance and collision insurance are optional coverages. They are not automatically included when you purchase a car insurance policy. Each policy costs extra, and adding them will affect your rate.
As of 2017, the average premium for collision insurance was $363 and the average premium for comprehensive insurance was $160. However, every driver pays a different rate. Factors like your location, age, driving record, claims history, the type of car you drive, and your insurance carrier all affect your premium.
What to Consider Before Buying Comprehensive and Collision Insurance
The truth is, not every driver needs comprehensive or collision coverage. In most states, the only required car insurance coverage is bodily injury liability and property damage liability coverage. You need liability coverage to legally drive almost anywhere. Buying additional coverage means getting more protection, but it also means you’ll pay a higher rate.
There are two main reasons against getting collision or comprehensive coverage. One is the value of your car. It only makes sense to buy collision and comprehensive insurance when the annual cost of your policy is less than the value of your car. You can also decide to forgo collision and comprehensive insurance if you fully own your vehicle.
However, most drivers will benefit from these optional coverages. Here are some specific reasons why you might consider getting comprehensive and collision coverage:
- Your car is leased or financed: If you drive a leased car, or are financing your car with a loan, your lender will probably require you to purchase collision and comprehensive insurance.
- You drive a luxury or high-value car: Fixing expensive cars can be very pricey. Having collision and comprehensive insurance will help you avoid a major expense if your car is damaged or stolen.
- You want the maximum protection: Some people want the most protection for peace of mind. Collision and comprehensive offer valuable coverage for most situations.
- You have a history of accidents: Drivers who have a history of accidents can benefit from collision insurance specifically. Any vehicle repairs needed after an accident are automatically covered.
- You live in an area with frequent crime: If you live in an area with a high crime rate, having comprehensive insurance will cover your car if it gets stolen or broken into.
- You can’t afford to repair or replace your car out-of-pocket: Drivers who can’t afford to repair their car after an accident should consider comprehensive and collision insurance to limit out-of-pocket costs.
FAQs about Comprehensive and Collision Insurance
Comprehensive insurance is worth it for certain drivers, particularly if you want the most protection and can’t afford to pay for repairs out-of-pocket. It’s also relatively inexpensive compared to other policies. The average cost of comprehensive insurance is $159.72, which is cheaper than collision insurance and liability coverage.
Comprehensive insurance is not required. Liability insurance is the only policy that is legally required at the state level. But depending on your situation, you might need it. If your car is leased or financed, your lender will probably require you to carry comprehensive insurance.
No, full coverage and comprehensive insurance are not the same thing. Comprehensive insurance is an optional policy that is included as part of full coverage insurance. Collision, liability, medical payments and uninsured/underinsured motorist coverage are also included in full coverage car insurance.
Drivers can consider dropping collision insurance when their annual insurance premium is more than the value of the car. In that case, it would be cheaper to pay for repairs out-of-pocket.