“What is comprehensive car insurance?” “What are the differences between comprehensive and collision car insurances?”
Sit tight. We are going to dissect and explain everything about the comprehensive car insurance cover.
The definition of comprehensive car insurance
Comprehensive insurance coverage is a type of insurance coverage that deals with repairs and replacements for your vehicle. However, there is a catch—It’s only valid if the damages are NOT collision-caused.
Yes, you can’t claim comprehensive insurance coverage after suffering damages from a collision car accident.
So, when is comprehensive insurance coverage valid?
If the damages to your vehicle are a result of fire, animal aggression, vandalism, or falling objects like trees or hailstones. In addition to that, the coverage is also valid for stolen vehicles.
You also need to be aware that insurance coverage is optional. It’s not a requirement by the law. Nonetheless, you’ll find that it goes hand-in-hand with another car insurance coverage called the Collision Insurance Coverage.
As the name suggests, collision insurance coverage is a policy that promises compensation for all car damages that are collision-caused.
Why is comprehensive car insurance important?
Despite being optional, one can argue that comprehensive insurance is just as important as collision car insurance.
Why? Because the coverage protects a person from a lot of uncertainties.
One can argue that most of the time, collision car accidents are a result of one or both drivers being careless. Therefore, you can avoid collision accidents.
However, comprehensive car insurance offers coverage for damages that are usually out of the driver’s control.
For example, you can’t anticipate and avoid car theft, you don’t know when someone might spray paint your vehicle or slash your tires, and neither can you anticipate lightning hitting a tree that eventually crashes your car.
Comprehensive protects your car from life’s unfortunate and spontaneous accidents.
Sounds safe, doesn’t it? Visit Surex for more on car insurance coverage in Nova Scotia.
What is not covered by comprehensive car insurance?
As mentioned earlier, comprehensive car insurance doesn’t cover your vehicle for collision-caused accidents. You will need to find an insurance policy that covers that specifically.
Also, comprehensive car insurance doesn’t cover medical bills. The coverage only deals with damages to the car itself.
In addition to that, the coverage is only claimable for the vehicle listed in the policy. It will not apply to somebody else’s car.
Comprehensive car insurance coverage is popular with leased vehicles or cars bought on loan. You’ll find that almost all leasing companies or lenders will require you to take a comprehensive insurance cover.
Comprehensive versus collision
Comprehensive car insurance offers coverage for all non-collision-related accidents. However, collision only covers for damages caused by collision accidents. It’s like the two are made to complement each other.
Most people use the 10% rule to decide whether or not they should include both in their overall auto insurance policy.
The 10% Rule involves assessing the cost of collision insurance coverage and comparing it to the current market value of the vehicle—It’s not worth it if the coverage is more than 10% of the current market value of your car.
Most people are more comfortable paying for comprehensive and leaving out collision coverage because comprehensive is more affordable.
Also, if the car is stolen, they can at least live comfortably knowing the insurance company will pay for a rental car until a replacement is made, or the car is recovered.
Nonetheless, collision also has its advantages. Unlike comprehensive that doesn’t cater for injuries, collision covers third party damages and injuries for collision accidents where you are at fault.
If you are not at fault, then the direct compensation property damage coverage(DCPD) will come to play. However, please note that DCPD is only available in a few provinces in Canada like Ontario, Quebec, Prince Edward Island, Nova Scotia, and New Brunswick.
How much does comprehensive car insurance cost?
We mentioned earlier that comprehensive is more affordable than collision. Nevertheless, there are still a lot of factors that determine the cost of comprehensive car insurance.
Factors like the car’s model and make can raise car insurance premiums. However, the cost of a basic comprehensive plan ranges between $100 and $300.
When looking for comprehensive car insurance at the right price, we’d advise you to go through several insurance companies and ask questions if you have any.
Deductibles in comprehensive car insurance
Your car insurance deductible is part of the claim that you pay from your pockets.
For example, let’s say you have $500 as your deductible in your insurance policy. Unfortunately, you get involved in an accident that ends up costing $1,500 for repairs.
After making a claim for $1,500, your insurance company will only give you $1,000 ($1,500 – $500). To complete the repairs, you’ll have to pay the remaining amount from your pocket.
Remember, the higher your deductible, the lower your monthly insurance premiums. Most people choose this option to save them some money. However, be careful. We’d advise you to have some emergency funds locked in a safe somewhere. That way, you can comfortably foot the remaining amount should you get involved in an accident.
The lower the deductible, the higher your monthly insurance premiums. It’s not the most popular option, but it’s much safer should an accident occur.
Take the time to talk with your insurance agent, and together you can evaluate and decide on the right amount to state as deductible in your insurance policy.
What is the claim process for comprehensive car insurance?
The process for claiming comprehensive coverage is the same as the typical insurance claim process.
The first step is to contact your insurance company.
Below are some of the details you should have when contacting your insurance company:
- A detailed report describing the cause and extent of damages.
- Photographs and videos of the scene are crucial.
- The police report and the name of the police officer present at the scene.
- The date and time of the accident.
From there on, your insurance company will commence a claim and assign you to a claims adjuster. The claim adjuster’s work is to assess the extent of damage and allocate the appropriate amount of money for repairs.
Once the insurance company approves your claim, you can proceed with the repairs.