There are several factors you need to think about when you’re looking at your auto insurance. We think about auto insurance as a way to protect us if we get into an accident, but what about if your vehicle is damaged without actually being involved in an auto accident? Like if a tree branch falls on your parked car, your windshield gets a chip in the glass or a deer suddenly runs out in front of your car while you’re driving, then what? Your comprehensive insurance covers you and will help get things back to normal.
Collision insurance helps you fix or replace your vehicle when you get into a car accident. However, collision insurance doesn’t cover the other stuff that can inflict damage on your car. That’s where a comprehensive insurance policy can protect you. Here’s a list of some of the things a comprehensive policy would cover:
Comprehensive insurance can also make life easier after your vehicle has been damaged. At ERIE, car rental coverage is available in the event of a comprehensive loss.
There’s an easy way to understand the differences between the two kinds of coverage. It comes down to the question of what happened to the car to damage it?
Collision insurance covers you when your car was in an accident, whether it was with another vehicle or an inanimate object, such as a guardrail, pothole, tree or building. It depends on the accident, of course, but in many instances, it insures you against things within your control.
Comprehensive insurance covers you when things besides a car accident damage your car, such as a falling tree branch, a break-in or hail damage from a storm. These things are considered beyond your control.
Many lenders require drivers to carry both collision and comprehensive on their policies. When the car is owned outright, these coverages can be optional*.
Car theft can mean different things. These are the kinds of things that are covered under a comprehensive insurance policy.
When you have a car loan, your lender may require you to take out comprehensive and collision insurance. That makes sense: If you’re financially shielded, you’re more likely to make on-time loan payments.
Once your car is paid off, having comprehensive coverage is optional.
As your car gets older, the overall replacement cost of your car can be a factor in whether you want to continue. Here’s one measure offered by the Insurance Information Institute: Multiply your premium for comprehensive by 10. If the value of the car is worth less than that total, it may be a good time to drop comprehensive. (And put the savings toward your emergency fund.)