General damages car insurance is another term for comprehensive car insurance coverage. To calculate the cost of general damages car insurance, you will need to know the differences in coverage types.
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There are several types of car insurance coverage you can buy for your car. Liability insurance is required by law, but comprehensive and collision policies are optional. Frequently bundled together, comprehensive and collision insurance are usually referred to as total car insurance when combined with liability.
Collision insurance addresses damage to your car that occurs in a collision regardless of who is at fault. Comprehensive car insurance takes care of general damages to your car, so to calculate general damages car insurance you need to evaluate the cost of comprehensive car insurance by itself.
The Benefits of General Damages Car Insurance
Comprehensive car insurance is sort of the catch all insurance coverage for your car. If you are at fault for an accident, then your liability insurance will pay for bodily injury or property damage incurred by the other party. If you have collision insurance then your insurance will pay for the damages to your car resulting from that same accident. However, general damages to your car are only covered by comprehensive insurance.
If a car is financed or leased then you will most likely be required to carry comprehensive car insurance by your lender or lessor. However, even if your car is bought outright or your car has since been paid off, if your car has a decent blue book value to it at all then comprehensive car insurance is probably worth keeping on your policy. Many random things can happen to damage your car and leave you with a repair bill or even worse, the need for total replacement. Comprehensive insurance helps cover those types of incidents.
Hail damage, shopping cart damage, and deer damage are all very possible things that can happen to anyone at almost any time and they can all do some substantial damage to your car. Without comprehensive car insurance you would either have to leave the car unrepaired or pay for the repairs on your own. With comprehensive car insurance you only have to pay your deductible and your car insurance company will pay for the repairs needed to bring your car back to its pre-damaged condition.
In worse case scenarios, if your car gets vandalized, stolen, or destroyed in a fire, comprehensive car insurance will pay you for the total loss of your car based on its current market value so you won’t be at a complete financial loss if your car is unrecoverable or beyond repair. Since your car insurance company will only pay you for the current value of your car based on its age, model, mileage, and other incidentals, determining the value of your car can help you decide if the cost of general damages car insurance is of real value to you.
Determining Whether to Buy General Damages Car Insurance
General damages car insurance, also known as comprehensive car insurance, is not beneficial to everyone. Since comprehensive car insurance pays for general damages to your car you need to decide if your car is worth the cost of the optional car insurance.
Newer cars, sporty cars, antique cars, and other cars with significant value need to have comprehensive car insurance or else risk being financially out of pocket if anything damaging should happen to the car. However, if you have a rundown car with a rust eaten exterior, a shabby interior, and on most days you are just grateful to make it to your destination, then you may not need to pay for comprehensive car insurance.
Comprehensive car insurance will not pay for any mechanical repairs unless they are a direct result of a comprehensive insurance claim. Since that is unlikely, the insurance will only pay you for certain cosmetic repairs to your car or, at most, the cost to replace it if is damaged beyond repair.
If your car’s market value is $1,000 and you pay $100 per year for comprehensive coverage with a $500 deductible, you will only receive a $400 net benefit if you submit a claim within the first year of your policy. If your car is worth less than $2,000 then you may be better off by putting that insurance premium money aside in a savings account instead and building your own emergency fund. That way the money will be there when you need it and if you don’t have any incidents then you won’t be regretting your spent premium dollars.
Buying General Damages Car Insurance
Buying general damages car insurance can be tricky because it is usually bundled with collision insurance. Since most people choose to by collision and comprehensive insurance based on the value of their car it makes sense that these two policies can be bought together to offer a complete protection plan. Whether you buy the insurance as a package deal or not, you should be able to carry different deductible amounts on each part of the policy. However, most people choose the same deductible for collision as they do for general damages.
To calculate general damages car insurance, try to get a quote for just comprehensive car insurance. If you can only get quotes for bundled deals, then be sure when you compare prices you compare rates for both comprehensive and collision insurance combined to get a fair comparison. Also be sure the deductible amounts are the same.
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