Comprehensive & Collision Coverage is often referred to as “Full Coverage”. Full Coverage is a really quite broad, as it can take on many different meanings. This coverage is very important to you personally since it covers your vehicle in the event of loss “in” or “out” of your control. The other aspect to consider with this coverage is your deductible. Your “deductible” simply means what you have to pay out of pocket before the Insurance Company pays. This coverage is required if you have a loan from a bank for your car. However, if you own your car, you still may want to consider having this coverage to protect you from a loss. Below are key points in considering Comprehensive & Collision Coverage.
Some items to consider when purchasing Comprehensive Auto Insurance
Comprehensive
Provides payment to you if damage is caused by the following: Fire, Vandalism, Theft, Weather, Animal Contact, and Glass Breakage. These claims will also not raise the cost of your insurance.
Collision
Provides payment for your car damages resulting from an accident caused by you. Unfortunately, these claims are considered “at-fault” and could possibly raise your insurance premiums.
Should You Have Comprehensive & Collision Coverage
As we discussed before, if you have a loan it will be required by your bank. If you own your car, you will want to determine if the cost of the coverage will suitable to insure how much your car is worth. For instance, if you have a newer car worth $20,000 Comprehensive & Collision Coverage is recommended. On the other hand, if your car is worth $3,000 you may want to save money, and carry Liability Insurance only.
What Deductibles Should You Have
This is really a personal decision depending on how much risk you like to take on. Some, don’t want to share any of the responsibility so they carry low deductibles and pay higher premiums. Others will carry higher deductibles like $1,000, to save on insurance cost, but will have to pay this amount in the event of a claim to fix their vehicle. Dave Ramsey, a world famous personal & financial coach recommends having higher deductibles.