Every U.S. state with the exception of New Hampshire requires its drivers to purchase liability insurance to drive legally. However, collision and comprehensive are optional, even though nearly four out of five drivers choose to purchase these coverages. Show
Collision coverageCollision pays for damage to your car resulting from a collision with an object (e.g., a telephone pole, a guard rail, a mailbox), or as a result of flipping over. The average cost is about $290 per year. Collision coverage reimburses you for the costs of repairing your car, minus the deductible. Collision coverage also covers damage caused by potholes. Comprehensive coverageComprehensive covers damage to your car caused by disasters “other than collisions,” and costs significantly less than collision coverage. With the average cost of comprehensive totaling a little over $134 per year, the coverage is cost-effective considering it covers damages to the vehicle caused by the following:
Drivers who finance the purchase of their car may be required to purchase both collision and comprehensive coverage. To reduce your auto insurance expenditures, I.I.I. recommends taking a higher deductible. If you are driving an older car, do the math to see if purchasing either collision or comprehensive coverage makes economic sense. Editorial Note: We earn a commission from partner links on Forbes Advisor. Commissions do not affect our editors' opinions or evaluations.
Get Auto Quotes As Low As $63/month, Compare Rates For Free, and Pay Less For Car Insurance Compare Rates Via EverQuote’s website Liability insurance is the foundation of auto insurance policies. It pays for the damage you cause to others–and is required in nearly all states. But two other important components of a good auto insurance policy are collision and comprehensive insurance. They do something liability insurance doesn’t do—pay for damage to your own vehicle or compensate you if it’s stolen. That damage may come from a source you wouldn’t expect—animals. A recent State Farm study found that drivers struck over two million animals between July 2020 and June 2021. That was a 7.2% spike over the previous 12 months. The top five states with the most animal collisions in that period were Pennsylvania, Michigan, Texas, California and North Carolina. Those crashes included 1.4 million involving deer. Collision and comprehensive coverage are important supplements to liability insurance:
Collision and comprehensive car insurance are often sold together as a package by auto insurers. Here’s how the coverage types compare. Nationwide, 74% of drivers with auto insurance buy collision coverage, and 78% buy comprehensive coverage, according to the Insurance Information Institute. Examples of When You Could Make a Collision Claim
Examples of When You Could Make a Comprehensive Claim
What’s a Deductible?Both collision and comprehensive insurance generally have deductibles. A claim on collision or comprehensive coverage will be reduced by the deductible amount. Common deductibles are $250, $500, $1,000 and higher. So, if you get into an accident and your vehicle suffers $2,000 worth of damage and your deductible is $500, the insurance company would pay $1,500 for the claim. Some auto insurers offer “diminishing deductibles” to customers as a reward for good driving. Under these programs, your deductible goes down over time if you don’t make certain claims. The Maximum Insurance PayoutFor both collision and comprehensive insurance, the maximum possible payout is the value of the vehicle right before the accident if it’s totaled, minus the deductible amount. A car can be considered totaled if:
And if you have a new car, don’t assume that it will be harder to reach a threshold for totaling it. The technology in new cars is so expensive to repair that it’s making cars more likely to be totaled in an accident. Do I Need Collision and Comprehensive Insurance?If you have a car loan or a car lease, you’re likely required to buy collision and comprehensive by the lender or leasing company. That’s so you don’t walk away from your loan or lease if your car is totaled or stolen. Once your car loan is paid off, collision and comprehensive will become optional. If you’re not required to buy collision and comprehensive, you may still want them. Ask yourself this: If your car were damaged or stolen, could you easily pay for repairs or to buy another car. If the answer is no, collision and comprehensive offer some financial protection. But as vehicles get older, collision and comprehensive coverage may become less valuable to you compared to the cost. As your vehicle’s value decreases, so does your maximum possible insurance payout if it’s totaled or stolen, especially if you have a high deductible. For example, let’s say you have a 2005 Honda Accord that’s worth about $3,300. If the car is totaled in a flood, and you have a $1,000 deductible, your insurance check will be $2,300. You can judge whether the price you pay for collision and comprehensive over several years is worth the potential benefit. The average collision claim is $4,412.31, according to the latest data from the National Association of Insurance Commissioners. The average comprehensive claim is $1,359.04. How Much Are Collision and Comprehensive Insurance?Nationally, the average cost for collision coverage is $378 a year and the average cost for comprehensive insurance is $168, according to the latest data from the National Association of Insurance Commissioners. See the average in your state below. What If Someone Else Damages My Car?Collision insurance is good for situations where you’ve accidentally damaged your own car, such as backing into a pole. But it can also come in handy if someone else crashes into you. If that happens, you have two choices:
What’s the Average Repair Time for a Damaged Car?The average repair time—the time you drop off your car at the auto body shop to the time you pick it up—is almost 11 days for cars, according to CCC Information Services, a provider of data and technologies to the automotive, collision repair and insurance industries. The average repair time has increased over the years, which CCC attributes to greater vehicle complexity and “many sophisticated vehicles” that take more time to repair. What About Insurance for Rental Cars?If you rent a car, your personal auto policy will typically extend to the rental, including liability, collision and comprehensive car insurance. That means you won’t need to buy the coverage offered at the rental counter, such as the collision damage waiver, unless you want to avoid possible claims on your own policy. Ask your car insurance agent to confirm that your policy will also cover a rental. Rental reimbursement auto insurance will help pay for that rental. This is an optional coverage type that helps cover the cost of a rental car if your car is damaged in an accident covered by your insurance policy. You will need to cover any rental costs over the rental reimbursement coverage limits. For example, if you have a $30 per day limit for a maximum of 30 days, you’ll have to pay out-of-pocket for any amount over the daily limit or that exceeds 30 days. You may be able to purchase higher limits. What Collision and Comprehensive Insurance Won’t CoverWhile collision and comprehensive coverage, along with liability insurance, provide a broad spectrum of coverage, they still don’t cover: Injuries that you sustain in an accident. (Depending on the situation, injuries could be covered by another driver’s liability insurance, or by your own personal injury protection or medical payments insurance, or your own health insurance.) Items stolen from your car, such as a laptop or wallet. (Instead, look to your homeowners insurance or renters insurance). Auto Insurance Spotlight: Stolen VehiclesA car is stolen every 36 seconds, according to the latest National Insurance Crime Bureau (NICB) Hot Spots report. COVID-19 didn’t hamper vehicle thieves. After a year of a decline in car thefts in 2019, car theft figures increased to 880,595 vehicle thefts in 2020 compared to 794,019 in 2019. Vehicle Theft Rates by StateThe Hot Spots report uses a theft rate based on the number of stolen cars per 100,000 people. Despite the increase in thefts in the U.S.,10 states saw a decrease in vehicle thefts from 2019. The comprehensive coverage portion of an auto insurance policy pays the value of your vehicle if it’s stolen, but the best defense may be a few preventative steps. The NICB recommends these four points of protection:
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