Accidents happen even while your vehicle is at rest and you are sound asleep, even more so when it’s hitting the road. No matter the circumstances or how you’ve mastered putting the brakes on, all types of accidents are inevitable. While you don’t wish untoward incidents for your car, it still needs to be insured.
Although many providers would offer you insurance coverage, you need to assess what coverage your vehicle needs carefully. In doing that, you need to know the basics of car insurance to compare them even online.
Car insurance is simply the contract between yourself and an insurance company. Basically, you agree to pay premiums for protection against financial losses curtailing from an accident or other damage to the vehicle.
There are some states where you’ll need to purchase various coverage types, while most of them will at least require you to have the minimum in terms of liability insurance coverage, So far, the most common coverage list is comprehensive, collision, gap coverage, uninsured motorist, bodily injury liability, and roadside assistance. This list will provide you with an array of coverage options to choose from tailored to your needs.
Premiums are what you pay your insurance providers to maintain your car insurance. You may either select any mode of payment, depending on your preference, which can either be monthly, bi-annually or yearly. On the other hand, deductibles are the payments you need to make when filing for a claim.
For most cases, comprehensive and collision coverage are essential. And it should be noted that some insurers may require you to buy both types of coverage together, instead of giving you the option to buy either the collision or comprehensive coverage separately.
The following are their most notable similarities and differences.
Read more: Difference Between Comprehensive Car Insurance And Zero Depreciation Cover
Comprehensive insurance reimburses for the damage to your car from all uncontrolled phenomena or situations. These could come from any of the following:
- hail storms that leave dents and shards on your car
- flood due to unforeseen calamities
- fire, even incidents in your garage that damaged your vehicle
- civil misunderstanding
- car theft
- damage from collisions with animals, such as accidentally hitting a deer and denting your fender
On the other hand, collision insurance covers damage to your vehicle in an accident involving a collision. This type of insurance covers damages during a collision with another vehicle, or with another object, such as the following:
- a tree rolling over your car
- hitting a lamppost
- hitting a pothole
- a vehicle sliding on a block of ice and hitting a quad rail
- crashing to a post just because you swerved from hitting an animal
- or someone dented your car and drove off
When it comes to the elements covered, both comprehensive and collision insurance have a broad spectrum. Simply put, they both cover vehicle damages alone. However, here are the things they both do not cover: 1) injuries you gained from the accident, 2) personal items stolen from your cars, such as gadgets or wallets, 3) medical bills, and 4) damage to another person’s vehicle
Both the comprehensive and collision insurance cover could be deemed compulsory, especially when the bank is financing the purchase.
Factors to Consider
There are several factors that should be considered when purchasing either comprehensive or collision coverage, or both. The first factor you should consider is your car’s value. Of course, the higher your car’s value, the more expensive it is to repair or replace in the event it is damaged. So, it is a must to have it insured whether you always hit the road or park your vehicle at home.
Another factor to consider is the risk index of your state. Each state has a risk index and exposure to natural and man-made hazards. Your state’s risk index may cover natural hazards, such as the swarming of wild animals, damages brought about by storms especially falling off of tree branches, or slippery roads due to snow and rain. On the other hand, your state’s risk index may also cover man-made hazards, such as the frequency of traffic jams and collisions, accidents caused by crime, and any other circumstances exposing your car to damage. On top of that, you should also consider how often you take your vehicle for a drive.
As these frequencies increase, the risk of your car being damaged at rest or while moving also increases.
And since you pay in premiums, you don’t have to worry about draining your savings account when untoward incidents happen, especially when your car is quite pricey. Remember that the higher the cost of your property, the higher the amount you will pay when damaged.
While they both cover a variety of unexpected events, they will only cover the damages incurred if and only if;
- a) For comprehensive coverage, it only covers damages from non-collision-related incidents
- b) For collision coverage, it only covers damages from collision-related incidents
The good news is that both types of coverage are subject to deductibles. Generally, this is the amount you must pay before your coverage kicks in, so this amount will be set when you buy your policy. Remember, a higher deductible results in more affordable monthly premiums.
Comprehensive and collision coverage are equally crucial for protecting your vehicle from physical damage. Of course, before purchasing one, you should choose the right coverage for your budget and needs. Note that some insurers may require you to buy comprehensive and collision coverage together, leaving you with limited options when you’re already there. So it’s always essential to shop around for the best insurance for your vehicle to find the right coverage for your car at the right price.