Comprehensive Car Insurance - 2022 Guide

If you’re in the market for car insurance after purchasing a newer vehicle, you may be wondering whether you should add comprehensive insurance to your auto coverage. Comprehensive insurance can offer peace of mind by covering expensive repairs or replacing your car after a non-collision event. If you’ve leased or financed a car, your lender will require that you purchase comprehensive insurance. However, if you own your car, it is an optional coverage you can add to your policy. Whether it’s required or optional coverage, comprehensive insurance can help protect you from damage to your car due to theft, vandalism, windstorms, floods and more. Keep reading to see how it works.

What Is Comprehensive Car Insurance?

Comprehensive insurance pays for replacing or repairing your car if it is damaged by acts of nature, theft, fire, falling objects, vandalism and more. Lenders will likely require comprehensive coverage if you are leasing or financing your car. If you own your car, it's optional coverage that can help save you money in the long-run.

Comprehensive car insurance is subject to a deductible — typically between $500 to $1,500.

What Does Comprehensive Cover?

Comprehensive insurance covers damage to your vehicle from:

  • Fire
  • Explosions
  • Hail
  • Lightening
  • Tornadoes or hurricanes
  • Floods
  • Tree limbs
  • Hitting an animal
  • Vandalism
  • Earthquakes
  • Theft
  • Riots

In many states, comprehensive auto insurance also pays to repair windshield damage.

How Does Comprehensive Coverage Work?

Comprehensive car insurance is subject to a deductible — typically between $500 to $1,500. If your car was hit by a fallen tree branch that causes $1,500 worth of damage to the roof of your car, and your deductible was $500, your insurer would pay $1,000 to repair the damage — the total repair cost minus your deductible.

If the cost of repair exceeds the value of your car, your insurance company will declare it totaled before subtracting your deductible from your car’s value and sending you a payment for the remainder. For example, if your deductible is $500 and the car was worth $20,000 before it was totaled by the tree branch, your insurance company would pay $19,500 (your car's value minus your $500 deductible). You could still choose to fix your car, in which case your carrier would subtract its salvage value from your payout.

How Much Does Comprehensive Car Insurance Typically Cost?

In 2019, the average annual cost of comprehensive coverage was about $172, making it cheaper than most types of coverage. In fact, comprehensive coverage is three to four times cheaper than collision. The cost of your policy is based on the actual cash value of your car, which is how much it would cost to repair your car subtracted from its depreciation.

Expensive cars will be more costly to insure, and your deductible will greatly impact the price of your premiums. You can lower the monthly cost of your comprehensive car insurance by raising your deductible.

What Isn’t Covered by Comprehensive Car Insurance?

Despite what its name implies, comprehensive coverage does have some exclusions. It does not cover damage to another person’s property, the value of items stolen from your vehicle or any damage that is covered by collision insurance, including:

  • Collision with a tree, road hazard or guardrail
  • Damage from a collision with another car: If you were at fault for the accident, this would be covered by collision insurance, if you have it. If the other driver is at fault, their insurance would pay to repair or replace your car.
  • Damage from a roll-over
  • Damage or injuries you cause to others
  • Injuries to yourself: Comprehensive insurance pays only for damage to your car. If the other driver is at fault, their insurance will cover your injuries. If you are at fault, your health insurance will cover your injuries.
  • Roadside assistance (towing)
  • Tire change
  • Gas, oil and water delivery
  • Battery services
  • Lockout services
  • Rental reimbursement
  • Personal property

Comprehensive insurance pays for replacing or repairing your car if it is damaged by acts of nature, theft, fire, falling objects, vandalism and more.

Comprehensive car insurance will pay out only up to the total market value of your vehicle, minus your deductible. The older and less valuable your car is, the less benefit you’ll get from the coverage.

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What Is a Comprehensive Deductible?

A comprehensive deductible is the amount you pay out of pocket to repair or replace your car after your claim is approved, before your insurer pays the actual cash value of your car. The comprehensive deductible you select affects your insurance rate and determines your out-of-pocket costs for repairs. Generally, the higher your deductible, the lower your insurance cost will be. A lower deductible will mean higher insurance costs.

Take the tree branch from earlier: Let’s say that it caused $1,000 worth of damage to your car. Your comprehensive deductible is $500. This means that you pay the first $500 and then your insurer will pay the remaining $500 to repair your car. If your car is much older, you may not want to reconsider buying comprehensive coverage since it is limited to the actual cash value of your car.

Who Is Comprehensive Car Insurance Best For?

States do not require comprehensive coverage. However, if you lease or finance your car, the terms of your contract may require that you purchase both comprehensive and collision coverage. This combined coverage (called full coverage) protects your car if it’s totaled or stolen before the loan is paid back. Additionally, comprehensive coverage can help cover your remaining loan balance after a theft or total loss.

Even if comprehensive coverage is optional, it’s still a smart idea to buy it depending on how much your car is worth. For example, if you don’t think you could afford to replace your vehicle if it cannot be repaired or if you aren’t sure you could cover the expense of sudden repairs, then comprehensive coverage would be a worthwhile investment. If you have a car only worth a couple of thousand dollars or if the deductibles and premiums are likely to exceed the actual cash value of the vehicle or exceed the cost of repairs, you may not want comprehensive coverage.

Comprehensive coverage is best suited for drivers who have a newer car and want to protect their car from damage or theft. If you don’t think you could afford to replace your car or pay for expensive repairs, then comprehensive coverage may be right for you.

Comprehensive coverage may not be best for drivers with an older car with a low fair market value. Determining your vehicle’s value, budget and other circumstances can help you decide if comprehensive coverage is right for you.

The average annual cost of comprehensive coverage is about $172, making it cheaper than most types of coverage.

FAQs

What’s the difference between comprehensive and collision insurance?

Typically, collision insurance helps drivers fix or replace their car if they get into a car wreck that is their fault. Comprehensive covers non-collision losses like hail, theft, vandalism or fallen trees.

Is comprehensive insurance required for all vehicles?

Comprehensive insurance is only required if you lease or finance your car until you’ve paid off your loan. If you own your car outright, comprehensive coverage is an optional add-on to your insurance policy.

Is full coverage the same as comprehensive?

The difference between full coverage and comprehensive coverage is that full coverage includes both comprehensive and collision insurance along with your state's minimum requirements. Comprehensive insurance is a singular coverage that covers damage to a car from non-accident damage, like fire or theft.

Key Takeaways

  • Comprehensive auto insurance pays for car damage from flooding, hail, fire and more that isn’t a result of collisions with other cars.
  • While no states mandate comprehensive coverage, your lender may require you to have it to protect their investment.
  • It may not be worth buying comprehensive car insurance if you have an older car.
  • The higher your comprehensive deductible, the less your insurance will likely cost.

Find Out More About Comprehensive Car Insurance

If you're shopping around for car insurance or are reviewing your current insurance policy, you may want to consider comprehensive coverage. Comprehensive insurance may be able to protect you from having to pay out of pocket for costly repairs. Since quotes vary for each person, comparing rates is the best way to save on car insurance. Just enter your zip code below and fill out a few questions to receive free car insurance quotes within minutes.

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