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Comprehensive vs Collision Insurance: How They Can Both Help

Auto Insurance

When browsing auto insurance options, you’re likely to see two main types of insurance: comprehensive and collision. If you own your car and it is registered in your name, then you’re likely responsible for having both types of insurance since each insurance policy provides different types of coverage. One is for damage to your car/bodily injuries during an accident, and the other is for damage to another person’s property outside of your vehicle as well as responsibility for injuring someone else. Comprehensive insurance covers the latter—it typically includes property damage protection and liability coverage to protect you from legal action and in-home medical, dental, and funeral services. On the other hand, collision only covers damage during a car accident.

Below, we’ll take a closer look at these two types of auto insurance to see which options might be right for you.

Characteristics of Collision Insurance

  • Pays for your vehicle’s damage if you hit an object or another car
  • Adjustable deductible (the amount of money you pay before your insurance policy pays anything)
  • Covers the cost of towing and labor to repair your vehicle
  • Offers coverage while you travel in another country or state, but it may be limited depending on where you are traveling
  • Different deductibles will result in different premiums (the amount of money paid to the insurance company every month)

Characteristics of Comprehensive Insurance

  • Covers damages due to fire, floods, or theft outside of a car accident
  • Has an average deductible and does not cover damages caused by crashing into objects or other vehicles
  • Can be more expensive than collision insurance because of larger monthly payments.
  • Covers towing and labor for damage or theft.
  • Travel outside of the country or state does not typically affect coverage, depending on your location and insurance policy.

Which insurance is right for you?

It depends on you and your finances, but in an accident involving major property damage, comprehensive would be the best option. In most cases, though, collision covers most car owners’ needs. The best way to decide which policy is right for you is to look at the specific terms of each type and think about the type of car you drive, the route it takes, and how much money you can afford to pay each month. Though comprehensive insurance offers great coverage, it has its limits and may not be the best investment for everyone.

Why Collision Insurance?

Surprisingly, not everyone has collision insurance. Collision insurance pays the costs of repairing your vehicle in the event of an accident. It also covers any medical bills you may have as a result of said accident. If you file a claim for damages, your insurer will typically ask to see a police report and estimates from body shops. Your collision coverage also covers damages sustained while driving another car in which you are not named as the owner.

Why Comprehensive Insurance?

Comprehensive insurance protects you and your property in instances outside of a car accident. This includes fire, vandalism, or theft. Your coverage also covers you if your car is stolen while parked and unattended. Comprehensive insurance can be costly because you’re covering more than just damage sustained in an accident, but it can be worth the money in the long run.

Key Takeaway

In Conclusion, both collision and comprehensive car insurance are necessary to protect your vehicle. Collision covers damages due to car accidents, protecting you financially in the event of an accident or the instance another driver hits your vehicle. Comprehensive insurance covers damages caused by incidents that are not related to a car accident (i.e. theft or vandalism) and provides medical coverage for injuries incurred while driving another vehicle you are not listed as the owner of.

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