When looking for the right kind of coverage for your car, you choose among the following basic policy types:
- comprehensive insurance;
- third-party only;
- third-party, fire and theft.
In the following article CarInsuranceGuru will answer a number of questions concerning comprehensive car insurance:
- What is comprehensive insurance, in the first place?
- Is it obligatory all over the U.S.?
- How to lower your premiums?
- Having bought comprehensive insurance, does it make sense to skip the others?
Shopping around for insurance for your car can get really confusing and frustrating at times, especially for the first timers. However, all you really need to do is familiarize yourself with the different terms and jargon used in the industry. It would also help to understand what the different types of coverage are, and which ones are essential and which ones are not.
One common term that people encounter when shopping around for car insurance is comprehensive insurance. The name itself is pretty self-explanatory – comprehensive means it covers everything, doesn’t it? Well, not really. In car insurance terms, comprehensive car insurance does mean coverage for most everything – except in cases of an accident or collision. It is a blanket term used to include natural occurrences such as “acts of God.” Hailstorms, floods, falling trees, vandalism, and the like are all covered by comprehensive car insurance. You can also file for a claim in the event that your car gets stolen. Again, damages to your car which are incurred due to a collision with another vehicle will not be covered by your comprehensive car insurance, if you have no collision insurance.
Comprehensive car insurance is not necessarily required in all states. However, if you take out a car loan, your loan provider may stipulate that you take out a comprehensive coverage. This is because they want to protect their investment – that is, your car.
When is it advisable to take out comprehensive car insurance? As this type of cover is not usually required by law, then the decision is mostly up to you. If you have a new car, then it is a good idea to purchase comprehensive car insurance. However, if your car is of an older model and make (and not in excellent condition), the additional premiums for comprehensive coverage may not be worth it.
To lower your premiums, you can opt for a higher deductible amount. Of course, the amount you indicate should be something that you would be able to afford in case your car gets damaged or stolen. A deductible of even just $1,000 can lower your insurance premiums substantially. However, you would have to pay – out of your own pocket – damages to your car which amount to $1,000 or less.
Do not make the mistake of thinking that since you have comprehensive insurance, you can do without the others. Always remember that this type of cover will not protect you from accidents nor will it pay for your medical bills.