Overview of Comprehensive and Collision Insurance One of the most confusing aspects of car insurance is the difference between comprehensive and collision insurance. Comprehensive insurance covers damage to the vehicle caused by something other than an accident, including a fire, theft, vandalism or natural disaster. Collision insurance only covers damage that occurs to the vehicle itself, for example, if the driver is involved in a crash. It does not replace the vehicle.
Comprehensive Insurance vs Collision Insurance When you purchase comprehensive coverage, it replaces your own coverage if you are ever involved in a vehicular accident. If you do not have this insurance, then your vehicle will be completely replaced and repaired. Once your vehicle is completely fixed, you can apply to have it towed to a garage, and then have your insurance company pay to have it replaced. If your vehicle is totaled out, then you will receive the funds that you would have paid to have it replaced minus the deductible on the policy. It is important to note that the amount of your deductible may vary from company to company. You will also want to understand how the insurance company determines the value of your car and how much they will pay to have it towed and repaired.
What Is The Coverage? Comprehensive coverage pays to fix your car, even if it is totaled out. They will also cover the repair of your vehicle in the event of a flood, fire or theft. This is the most comprehensive type of insurance, but usually the most expensive one as well.
What Is Collision Coverage? Collision coverage covers damage to the vehicle due to a collision with another automobile or object. It does not cover damage caused to the vehicle itself. This type of auto insurance pays to fix your vehicle if it is damaged, regardless of who is at fault. It covers damages to other people’s property as well as personal injury costs in the case of an automobile accident.
What Is Actual Cash Value? Actual cash value is what your premium will be for your comprehensive coverage. The cost of your premiums is based on the actual cash value of your vehicle. It is calculated by taking the age, make and model, and year of your vehicle and deducting depreciation up to a certain percentage. Your actual cash value will be the amount that you will be quoted at for your premium.
What Is Physical Damage Coverage? Physical damage coverage or physical damage insurance is required only if you are at fault in an accident. It pays to repair or replace your vehicle if it is damaged. It will not cover any repairs to your vehicle that are necessary as a result of a flood or fire.
What Is Wallethub? A wallethub means something different when it is spoken or written. When people refer to a person with insurance, they are usually talking about a person who has an insurance policy that is a good combination of comprehensive coverage and a major medical insurance policy. Most of the time, all three policies are blended together in one policy called a “multi-line policy.” This type of policy covers motorists involved in multi-car collisions as well as drivers who cause accidents that result in one car or multiple vehicles getting damaged.
How is Collision Coverage Calculated? Comprehensive and collision insurance will both cost the same for the same type of coverage. Each company will calculate the cost of their collision coverage based on the make and model of the car being insured. The cost of comprehensive insurance will be higher than the cost of collision insurance.