Liability-only auto policies may satisfy state and lender requirements, while comprehensive and collision coverages provide added protection from events such as weather events, animal collisions, theft and vandalism.

Lives who reside in hazardous areas should carefully consider both types of coverage. It all comes down to your budget and needs.

Comprehensive Coverage

Comprehensive car insurance covers non-crash damage due to hailstorms, firestorms and other adverse weather events as well as theft and animal collisions such as with deer. The maximum payout of comprehensive policies generally equals their actual cash value minus your selected deductible amount.

If you’re leasing or financing a vehicle, your lender will likely require comprehensive and collision coverages for it to remain legal. Unfortunately, the costs for these types of policies can vary depending on both state law and insurance provider – sometimes covering less than what your vehicle actually worths! In such instances they could simply be an unnecessary waste of cash.

Consider whether comprehensive or collision auto insurance is right for you by looking at various factors, such as your vehicle’s current value and usage patterns. If it sits largely unused in its garage, for instance, comprehensive and collision policies might not make sense at all.

Review your coverage needs regularly to ensure they meet your driving lifestyle, or seek assistance choosing appropriate protection. At Montgomery Insurance Services we can help – contact us now for more information or a quote to find an investment protection plan tailored specifically to meet your needs!

Collision Coverage

Collision insurance pays to repair or replace your vehicle in an accident caused by you, another car, or stationary objects like poles and trees that your vehicle strikes. Lienholders typically require this form of coverage as part of a loan or lease agreement, often justifying its additional cost by giving peace of mind to all parties involved. Before purchasing collision coverage for your car however, take time to understand its actual cash value and deductible amounts before purchasing this policy.

Typically, increasing your deductible will lower premiums. Just make sure it’s an amount you can comfortably cover should an accident happen.

As you consider whether or not to acquire collision insurance, the key point to remember when making this decision is that collision only covers events within your control when driving. For instance, hitting an animal or falling tree are covered under comprehensive but when you swerve to avoid them and hit something instead such as a guardrail it would not.

Bottom line, collision coverage should only be considered worthwhile if your car is new and/or holds significant monetary value; otherwise, comprehensive plans that cover less catastrophic damages such as theft, vandalism, hailstorm or broken glass might be more cost-effective.

Deductibles

Comprehensive insurance requires setting a deductible, which is the out-of-pocket amount you must pay on each claim, to help manage premium costs. A higher deductible reduces premium costs; just make sure that your finances can cover it should an accident arise!

Liability insurance protects both you and others in an at-fault accident, but doesn’t cover repair or replacement of your car beyond what’s covered under your policy limits. Collision and comprehensive coverage fill this void, helping cover costs associated with restoring or replacing it.

Though some individuals can forgo comprehensive and collision coverages altogether, it’s essential to assess whether they make sense for you. For instance, living in areas prone to natural disasters or wildlife collisions makes comprehensive and collision policies worth having.

If you still owe money on your car or are leasing it, your lender may require that you maintain physical damage coverage (comprehensive and collision) until the loan or lease has been fully paid off. Under such circumstances, it might make financial sense to carry this coverage; however, if your vehicle is older with low market value it might make more sense to cancel them out altogether.

Coverage Limits

Limits on these coverage options dictate how much your insurance will pay in the event of damage or theft of your vehicle. Collision typically pays up to the actual cash value minus any applicable deductible; comprehensive typically has lower limits ranging from $500 or $1,000 up to $5,000 or higher, depending on your state and insurer.

Both coverages offer distinct advantages, and many drivers opt to have both comprehensive and collision. It is important to remember that both policies provide physical damage coverage; full coverage typically refers to having both comprehensive and collision policies as well as liability coverage (required by most states).

Collision coverage applies when your car strikes other cars or stationary objects such as guardrails. Additionally, this insurance also protects if it rolls over or is struck by objects like trees and poles. Comprehensive covers other incidents unrelated to collisions like natural disasters, theft, vandalism and hail damage; although having both may not be necessary in a no-fault state where repair costs would come out of your own pocket; if however your car features high value features or is newer it might be wiser.