What is the Difference Between Comprehensive and Collision Coverage?
Apart from liability insurance which is a requirement for all vehicle owners to have, the other main types of auto insurance are collision and comprehensive insurance. While both of them are meant to provide physical protection to your vehicle, the type of damage covered by each is totally different. In this article, we look at the key differences between collision and comprehensive insurance in detail.
What is collision insurance?
Collision insurance covers any damage to your car caused by contact with an object, another vehicle, and rollovers. Collision insurance covers any physical damage to your vehicle regardless of who is at fault in the accident. The following are some of the common damages covered by collision insurance;
- crashing into a building
- hitting a tree
- hitting a telephone pole
- rolling your car
- Hitting a curb or pothole
- being hit by another vehicle
- backing into another car
What is comprehensive insurance?
Comprehensive auto insurance covers any damage to your vehicle that is not caused by a collision. It is an all-encompassing insurance option which protects your car from all other things other than a collision that may damage your car such as falling objects, vandalism, natural disasters, striking an animal, extreme weather conditions, among others.
Comprehensive vs Collision insurance
Both comprehensive and collision insurance have their advantages and disadvantages that are determined by their differences. But, let's first look at the similarities between the two. Both types of insurance are optional under the law unless you have a leased or financed car in which case you will be required by law to have them.
Both of them are meant to cover physical damage to your vehicle. Both of them also come with a deductible. The deductible is the amount that the insured pays first towards the repair of the vehicle before the insurance company covers the rest following a claim.
Now let's look at some of the differences.
In general, comprehensive insurance pays for any damages caused by something that humans have little or no control over, such as hail, earthquake, and other causes. On the other hand, collision covers damages that occur when the driver has more control, for example, if you accidentally crash into a pole or rear end someone's car when parking.
Another difference between the two that is really felt by the insured party is that with collision coverage, you can expect your auto insurance rate to increase following a claim. This is because collision insurance covers at-fault accidents. With comprehensive insurance, your insurance rate does not rise even after a claim since the damage was caused by something out of your control. Some states have laws against rate increases as a result of comprehensive insurance claims.
Must you have collision or comprehensive insurance?
The answer is no. The only coverage that vehicle owners are required by law to have is liability insurance. However, it is vital to have either or both to protect you from unexpected expenses especially if you get into an at-fault accident. Without collision or comprehensive insurance, you risk having to cover all repairs or even the total replacement cost of the vehicle out-of-pocket.