July 26, 2021

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Comprehensive vs. Collision Insurance: What’s the Difference? – NerdWallet

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Comprehensive and collision insurance are two of the most important types of car insurance to understand. They’re not legally required by any state, but they can come to the rescue in a variety of situations.

Collision and comprehensive coverage are often sold as a package. Both pay to fix damage to your own car or replace it entirely — but they don’t cover injuries or damage to anyone else’s property.

Comprehensive vs. collision insurance

The main difference between comprehensive and collision insurance is the scenarios they cover. Collision insurance pays for damage to your car if you hit an object or another vehicle, while comprehensive coverage pays for theft or damage from causes such as bad weather, fire or fallen trees.

Collision insurance pays for:

  • Damage to your car in an accident you cause.

  • Damage to your car if you hit an object such as a fence or pole.

  • Damage to your car if someone else hits you. Another option in this case is to make a claim against the other driver’s liability insurance.

Comprehensive insurance pays for:

The value of your car if it’s stolen and not recovered, and damage from:

  • Weather such as tornadoes or hail.

  • Falling objects.

  • Explosions.

  • Crashes with an animal, such as striking a deer.

  • Riots and civil disturbances.

  • Vandalism.

How much comprehensive and collision coverage cost

To get realistic comparisons, we analyzed rates for minimum-coverage policies and compared them to policies with comprehensive, collision and higher liability limits that together are commonly considered “full coverage” car insurance. Here are the rates for the seven largest insurance companies in the U.S.

Full coverage

Minimum required coverage

Annual difference

*USAA is available only to military members, veterans and their families.

For a quick view of which companies are cheapest on average for full coverage, see this chart.

Car insurance rates vary widely by state for similar policies, and adding comprehensive and collision coverage costs more in some places than others. Below are the average cost differences between minimum and full coverage policies in every state for a driver with no recent tickets or accidents. Keep in mind that your own rate will depend on the value of your car, your location, your driving history and the deductible amount that you choose.

Full coverage

Minimum coverage

Annual difference

National average

California

Connecticut

Massachusetts

Mississippi

New Hampshire

New Jersey

New Mexico

North Carolina

North Dakota

Pennsylvania

Rhode Island

South Carolina

South Dakota

Washington

Washington, D.C.

West Virginia

How to save on comprehensive and collision insurance

As you can see, average annual rates can vary by hundreds of dollars, so it’s worth shopping around for car insurance quotes from several companies to make sure you’re getting the best deal.

Another way to save money is by raising your comprehensive and collision deductibles. Many policies offer options as high as $2,000. But do this only if you’re prepared to spend more of your own money to fix or replace your car.

Do I need comprehensive and collision insurance?

About 78% of all U.S. drivers buy comprehensive coverage, and 74% buy collision, according to an Insurance Information Institute analysis from 2017, the most recent data listed.

You should consider buying comprehensive and collision insurance if:

  • You lease your vehicle, or took out a loan to buy it. Your lender or leasing company probably requires you to carry both collision and comprehensive coverage.

  • You couldn’t afford to replace or significantly repair your car if you crashed it or someone stole it.

  • Your area has a high incidence of car theft, vandalism, severe weather (like hail) or animal collisions.

You probably don’t need comprehensive and collision insurance if your car is older and not worth a lot. Remember the maximum payout will be the value of your car if it’s totaled or stolen, minus the deductible.

If your car’s value is low, consider whether the potential payout would be worth the premiums you’ll pay. Remember, too, that the deductible amount will reduce any claims check. Check out NADAguides for your car’s current value.

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