Myers, Naples Insurance Agency talks about car insurance and the difference between comprehensive and collision coverage.
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Comprehensive and Collision Coverage
Collision coverage and comprehensive coverage are two optional types of coverage on your insurance policy, but if you are still paying off a car loan or if you have a lease on your vehicle, the financing company almost always requires these coverages.
Collision coverage typically pays for damage to your vehicle if it is involved in a collision with another vehicle or if it hits an object. It's different from liability coverage, which typically relates to damage to property belonging to another party involved in an accident you caused or bodily injury to another person. Collision coverage comes with a deductible. This means you'll pay out of pocket for some of the damage, and any amount after that is typically covered up to the actual cash value of your car. Typical deductibles are between $0 and $1,000. Generally, the higher your deductible, the lower your premium. Remember your car's actual cash value takes into account the price of your car when it was purchased as well as the age and condition of your vehicle. If it is worth close to or less than your deductible, collision coverage might not be right for you. Comprehensive coverage protects you against losses caused by covered damages not related to a collision. These damages often include storms and natural disasters, such as a hurricane or a tornado, vandalism, theft, falling objects, animal damage or a broken window, but you should make sure to ask your agent what perils are included in your policy. If your goal is to pay as little out of pocket as possible in the event of a claim, then you may want to consider lowering your deductible. This will raise your insurance premiums, but you will have the peace of mind of knowing that you won't have to pay a high deductible to repair or replace your car in the event of a covered loss.
