Comprehensive Insurance

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The Driver’s Guide to Comprehensive Insurance

Comprehensive insurance is actually a type of coverage most drivers may think they have with standard car insurance coverage but are probably wrong. If you are the type of driver who only wants or needs liability insurance, then comprehensive insurance may not be what you need. Or if you live in a state that requires PIP or Personal Injury Protection then you may not need comprehensive. However, if you want total protection or have a financed car, more than likely you will not only want comprehensive car insurance you will be required to carry it.

comprehensive insurance

The first thing you should know is what exactly comprehensive auto insurance is. Understanding what comprehensive car insurance coverage is, will help you be certain you have total coverage when it comes to protecting your car and yourself as a driver. There is some confusion generally about comprehensive versus collision insurance coverage, but once you comprehend comprehensive it should all make sense.

The Basics of Comprehensive

When it comes down to understanding your own car insurance coverage or options, one thing that can get confusing is what exactly comprehensive car insurance is and how it covers drivers. Here are some things to know about comprehensive auto insurance to help you gain a better understanding:

  • Generally, comprehensive insurance is the coverage that covers issues other than collisions with other cars. The problem is many drivers assume their collision coverage takes care of any problems that may arise, including all collisions.
  • While some collision policies do cover all types of accidents, many do not. For example, if you have an accident with another vehicle then you should be covered. However if you have a collision with a deer or even a structure such as a house, your collision policy probably will not cover it.
  • Comprehensive takes over where collision does not, in most cases. Aside from collisions with animals or inanimate objects your comprehensive usually also protects against fire, theft, vandalism, floods, natural disasters, Acts of God or other types of damages that are not covered under other auto insurance policies.
  • The driver would still be responsible for the deductible as is standard with all insurance policies. Also, you will probably still want collision insurance and may be required to have it. In fact you may even need gap insurance coverage on top of your comprehensive coverage.
  • Where comprehensive and collision leave off, gap auto insurance picks up. For financed cars you often need all three of these. While the first two cover your damages often, gap helps if the car should be completely damaged and totaled out or is stolen and unrecoverable. The amount you owe for your car loan is usually much greater than the value of the car. If the car should be totaled out your standard insurance would only pay what the value of the car is, leaving you responsible to pay the rest out of your own pocket. To insure this difference, you will also need GAP insurance.

Do You Need it?

If you have a financed car, more than likely you need comprehensive auto insurance. Or if you have a car of great value that you want more than liability auto insurance on, you may also want collision and comprehensive. Although it is not required by any state it is more than likely mandatory by the guidelines of your car loan lending company. The problem is if you do not have all of the coverage in place that you need your finance company may do this for you.

The insurance coverage a lending company tacks on to a financed vehicle is never cheap. Often times you may not even know the lender has added comprehensive insurance or other types of car insurance you are lacking until the end of the loan. Or until what you thought was the end of the loan. When you go to make your final payment you are likely to find you still have a large balance due. This balance will be the insurance coverage the lender put in place for your financed car.

Other Things to Ponder

If your car is of any value you will probably want to have comprehensive car insurance as well as collision. There are too many things that can happen to your vehicle and things you cannot plan for. Of course, there are also a lot of factors that go into determining what your policy premiums may be. For instance:

  • Where you live – Your state right down to your zip code will have a lot to do with your premium costs. Take for instance states with a higher likelihood of tornadoes. Then factor in what your rates could be if your zip code falls into an area that doesn’t have as high a chance of getting hit with a tornado. Right away, this helps lower the likelihood of you having higher rates for this part of the state.
  • Where you park at night – Aside from your zip code even where you park at night has a lot to do with the premiums. If your vehicle is kept safe from theft, vandalism or even storm damage inside a garage you will probably have lower rates. However, if you park on the street in an area known for higher crime or statistically more chance of storm damage, you may have higher rates.
  • Your deductible and method of payment – The higher the deductible the lower the premiums. Of course, be careful because a high deductible like $1,000 may make it difficult for you to come up with at the time of a claim. Just avoid having too small a deductible because your rates will be higher. Also, when making your payments try to set this up for auto pay. Skipping having the bill sent out will help cut down on your monthly payment amounts.

If you are ready to find out how low your insurance rates could be all you need is your zip code to get started. By doing this you will get the comprehensive insurance you need to be protected.