If you searched for “What comprehensive insurance covers”, and you come across this post, you’re on the right page. Comprehensive insurance, often referred to as “comp insurance,” is a type of auto insurance coverage designed to protect your vehicle against a wide range of non-collision-related damages.
Understanding what comprehensive insurance covers can help you make informed decisions about your insurance needs and ensure that you’re adequately protected. This comprehensive guide will explore the ins and outs of comprehensive insurance, providing you with all the information you need to know.
What Is Comprehensive Insurance?
Comprehensive insurance is a type of auto insurance that covers damage to your vehicle caused by events other than collisions. This includes incidents like theft, vandalism, natural disasters, and more. It is often an optional coverage, meaning you can choose to add it to your auto insurance policy if you want broader protection for your vehicle.
While liability insurance covers damages you cause to others and collision insurance covers damages to your vehicle from accidents, comprehensive insurance covers a variety of other potential risks. It’s important to note that comprehensive insurance typically requires a deductible, which is the amount you pay out of pocket before your insurance coverage kicks in.
What Does Comprehensive Insurance Cover?
Now, you know what comprehensive insurance means, so let’s look at what comprehensive insurance covers. These include;
Theft
If your vehicle is stolen, comprehensive insurance can help cover the cost of replacing it. This includes the value of the car and any permanently installed equipment or accessories. Ensure your vehicle is locked and secured to avoid claims being denied due to negligence.
Vandalism
Comprehensive insurance covers damage to your vehicle caused by vandalism, such as broken windows, slashed tyres, or graffiti. Document the damage thoroughly and file a police report, as your insurer will likely require it for the claim.
Natural Disasters
This coverage includes damage caused by natural disasters such as floods, hurricanes, earthquakes, and tornadoes. Consider your geographic location when evaluating the importance of this coverage. Areas prone to natural disasters may benefit more from comprehensive insurance.
Fire
Damage to your vehicle caused by fire, whether it’s due to an engine fire, arson, or a wildfire, is covered under comprehensive insurance. Maintain your vehicle to reduce the risk of fires starting from mechanical issues.
Falling Objects
If your car is damaged by falling objects, such as tree branches, hail, or debris from a storm, comprehensive insurance will cover the repairs. Park your vehicle in a garage or away from large trees during storms to minimize the risk.
Animal Collisions
Collisions with animals, such as hitting a deer, are covered under comprehensive insurance, unlike collisions with other vehicles, which are covered under collision insurance. Even though comprehensive insurance covers this, it is important to drive cautiously in areas known for high wildlife activity to avoid accidents.
Glass Damage
Comprehensive insurance typically covers glass damage, including broken windshields, windows, and sunroofs. Bear in mind that some insurers offer separate glass coverage with lower or no deductibles, which can be beneficial for frequent claims.
Acts of Terrorism
Damage to your vehicle caused by acts of terrorism may also be covered under comprehensive insurance, though this can vary by insurer and location. Make sure to review your policy to understand the extent of coverage for such incidents.
Read Also: What Is Claim in Insurance
What Comprehensive Insurance Does Not Cover
While comprehensive insurance covers a broad range of incidents, there are certain things it does not cover. Here’s a list of some things not covered by comprehensive insurance;
Collision Damage
Damage to your vehicle from a collision with another vehicle or object is not covered by comprehensive insurance. This falls under collision insurance.
Personal Injury
Injuries to you or your passengers are not covered by comprehensive insurance. Personal injury protection (PIP) or medical payments coverage (MedPay) would cover these expenses.
Mechanical Breakdown
Wear and tear or mechanical failures are not covered by comprehensive insurance. These issues are typically covered by a warranty or separate mechanical breakdown insurance.
Intentional Damage
Now, while comprehensive is seen to cover almost everything related to insurance, it doesn’t cover damages caused intentionally by the policyholder or other listed drivers are not covered.
Items Inside the Vehicle
Personal belongings inside your vehicle, such as electronics, clothing, or other personal items, are not covered by comprehensive insurance. Homeowners’ or renters’ insurance might cover these items.
How Comprehensive Insurance Works
To understand how and what comprehensive insurance covers, here’s a breakdown for you;
Deductibles
When you file a comprehensive insurance claim, you’ll need to pay a deductible before your insurance covers the remaining costs. Deductibles can range from $100 to $1,000 or more, depending on your policy.
Key Points: Choosing a higher deductible can lower your premium but means higher out-of-pocket costs in the event of a claim.
Claim Process
Filing a comprehensive insurance claim is not as hard as some put it out, provided you have all the necessary documents. It typically involves the following steps;
- Take photos and gather details about the incident.
- For theft, vandalism, or other criminal acts, you’ll need to file a police report.
- Notify your insurance company as soon as possible and provide the necessary documentation.
- Your insurer may require you to get a repair estimate from an approved mechanic or repair shop.
- Once the claim is approved, you can proceed with repairs or replacement. The insurance company will pay the costs minus your deductible.
Coverage Limits
Comprehensive insurance has coverage limits, which is the maximum amount your insurer will pay for a covered claim. This is typically the actual cash value (ACV) of your vehicle, which takes depreciation into account. If the repair costs exceed the ACV, your vehicle may be considered a total loss, and your insurer will pay you the vehicle’s value minus the deductible.
Is Comprehensive Insurance Worth It?
Whether comprehensive insurance is worth it depends on various factors and your needs, including:
- Vehicle Value
If you have a newer or more expensive vehicle, comprehensive insurance is often recommended to protect your investment. For older vehicles with lower values, the cost of comprehensive coverage might not be justified.
- Geographic Location
Living in areas prone to natural disasters, high crime rates, or heavy wildlife activity increases the likelihood of needing comprehensive coverage.
- Financial Situation
Consider your ability to cover the cost of repairing or replacing your vehicle out of pocket. Comprehensive insurance can provide peace of mind and financial protection in case of unexpected damage.
Conclusion
Comprehensive insurance offers valuable protection for a wide range of non-collision-related damages to your vehicle. By understanding what it covers, what it doesn’t, and how it works, you can make informed decisions about your auto insurance needs. Always review your policy details and discuss with your insurance provider to ensure you have the right coverage for your situation.
