Comprehensive vs. Collision Insurance: Do You Need It? (original) (raw)
If you're like most people, you may think your car insurance premiums are too expensive. The average cost of full coverage car insurance is $187, and if you have a teenager on your policy or a spotty driving record, your costs could be significantly higher.
Comprehensive and collision coverages make up about half of auto insurance premiums. If you're looking to reduce your expenses, it might make sense to consider dropping one or both forms of coverage. Whether that's a good idea will depend on your type of vehicle ownership, finances, risk tolerance, and vehicle value.
Smart Drivers, Smarter Savings.
Compare car insurance rates in District of Columbia
See if lower rates are available
Currently Insured?
Yes
No
By clicking the button above, I understand and agree that this site uses site visit recording technology (provided by Trusted Form, Jornaya, and Microsoft Clarity) Privacy Policy
Unlike liability insurance, collision and comprehensive insurance aren't required by any state law. Instead, they are optional forms of coverage that protect your own vehicle.
Collision and comprehensive insurances cover different things. In simple terms:
- Collision insurance: Coverage applies if your vehicle collides with an object, such as a light post, tree, or another car. Collision coverage pays for repairs to your car. If the car is totaled, collision insurance would pay for its value rather than pay to fix it.
- Comprehensive insurance: Coverage applies if your car is damaged in ways other than a driving accident. Comprehensive coverage pays for repairs to your vehicle. For example, if thieves smash your car's windows, you run into a deer, or a hail storm damages your car, comprehensive coverage would pay for the repairs or provide a payout equal to your car's value.
Both forms of coverage are usually required if you're leasing the vehicle or financing it with a loan.
| Coverage | Comprehensive insurance | Collision insurance |
|---|---|---|
| Natural elements (fire, tornadoes, etc) | Yes | No |
| Theft and vandalism | Yes | No |
| Car accident | No | Yes |
| Other covered situations | Comprehensive insurance may also cover damage from animals | Collision coverage may also cover damage from potholes |
| Situations not covered | Damage caused by hitting another vehicle or object | Repairs for another vehicle and costs of medical treatment for you, your passenger or the other driver |
How does comprehensive insurance work?
Comprehensive insurance covers situations out of your control that cause damage to your vehicle. Typically, comprehensive insurance covers weather-related events, vandalism, or fire. For example, if your town is flooded and your car has water damage, comprehensive insurance would pay for its repairs or would pay you for its current value.
Factors that affect car insurance rates include:
- The type of vehicle insured
- Typical cost of repairs for your car's make and model
- Crime rates in your area
- Location, including your city and state, and whether you live in an urban or suburban area
- Whether you store your car in a garage or use street parking
- Your selected deductible
Typical comprehensive policies have deductibles ranging from 100to100 to 100to2,500. The higher the deductible, the lower your premiums will be. But you'd have to pay more out of your pocket before insurance kicks in if your car needs repairs after an incident.
How does collision insurance work?
Collision insurance covers your car if you're involved in an accident with another vehicle or object. For example, if you didn't see a stop sign and hit a car or veered off the road into a neighbor's fence, collision coverage would pay for the repairs to your vehicle.
The cost of collision insurance will vary based on the following variables:
- The type of car you drive
- Typical cost of repairs to your make and model of vehicle
- Your driver safety record
- Usage and annual mileage
- Your selected deductible
In general, collision deductibles range from 0to0 to 0to1000.
What both auto insurances share
Although comprehensive and collision insurances cover different situations, they have some similarities:
- They pay for your property damage. Liability insurance coverage pays for damages or injuries you cause to others. By contrast, collision and comprehensive coverages pay for the repairs or replacement of your property after a covered incident.
- They may be optional. Collision and comprehensive coverages aren't required by law. They're optional forms of insurance, however, that might not be the case if your car isleased or financed. Most lenders will require you to carry both collision and comprehensive insurances to have full coverage for your car is owned outright or your lease is over.
- They're purchased together. Collision and comprehensive coverages usually cannot be purchased separately from one another, but you may be able to choose different deductible levels. For example, your collision coverage may have a deductible of 500,whereasyourcomprehensivecoveragehasadeductibleof500, whereas your comprehensive coverage has a deductible of 500,whereasyourcomprehensivecoveragehasadeductibleof100.
- You don't set the coverage limit. With liability insurance, you could choose how much coverage you want. But with collision and comprehensive coverages, you don't have the same option. Instead, the maximum amount of coverage is based on the market value of your car.
Which auto insurance should you choose?
In most cases, you can't choose to get just comprehensive or just collision coverage. If you want one type of property damage insurance, you usually have to get both collision and comprehensive coverages.
Property damage coverage isn't required by law, but it could make sense to carry a policy that includes liability, collision, and comprehensive coverages. The average premium cost for a policy that includes all three coverages is $187 per month, according to Insurify.
If you're looking to save money on car insurance and are trying to decide whether collision and comprehensive insurances are worth the expense, ask yourself the following questions:
Do you own your car outright?
While states have different laws around liability insurance, no state requires drivers to have collision or comprehensive coverage. However, if you are leasing or financing the vehicle, your lender likely will require collision and comprehensive coverages as part of your contract.
How much is your car worth?
Whether collision or comprehensive coverages are worth it might depend on your car value. A general rule of thumb is that you could consider dropping your coverages if their premium is more than 10% of your car's value.
Could you afford to replace or repair the car on your own?
When you're considering what coverage you need, be sure to consider the state of your finances. Without collision and comprehensive coverages, you may have to pay for all the repairs to your car yourself. If it's totaled, you may have to buy another car on your own.
If your car is older or inexpensive, you may not need coverage because you could repair it or replace it with cash. But if you have a newer vehicle and would struggle to repair or replace it, adding collision and comprehensive coverages to your policy might make sense.
FAQs
Is comprehensive better than collision insurance?
One type of insurance isn't better or worse than the other. Comprehensive and collision insurance provide different coverages. Comprehensive pays for repairs for damages that occur outside of your control, while collision insurance pays for repairs after an accident.
What is liability insurance?
Liability insurance is the portion of auto insurance that drivers are required to have by state law. Liability coverage usually includes both bodily injury coverage and property damage coverage. Liability insurance pays for damages or injuries you cause to other people or their property.
What is the main difference between comprehensive and collision insurance?
The main difference is what they cover. Collision insurance will cover repairs after your vehicle is in an accident with another car or an object. Comprehensive coverage will cover repairs for damages that are caused by natural disasters, theft, or falling objects.
Bottom line
Do you really need collision and comprehensive insurance? If you have a new car — or if it's expensive to replace or repair — you may prefer having both forms of coverage, even though they aren't required by law.
Learning how car insurance works could help you understand your car insurance policy and learn the ins and outs of car insurance. When you're ready to buy a policy, check out our list of the best car insurance companies.
- You could save up to $600 with some companies.
- Compare dozens of providers in under 5 minutes.
- Fast, free, and easy way to shop for insurance.
- Quickly find the perfect rate for you.