While collision and car insurance are often times packaged together on a policy, they can also be purchased separately. Both policies are usually used together to form a more complete car insurance package.
The insurance claim you file will depend on the reason that your vehicle incurred damage. There is a distinct difference between collision verses comprehensive car insurance claims and why they may be needed in addition to liability car insurance.
Read on to learn the difference between comprehensive car insurance and collision car insurance and even liability car insurance and then be sure to enter your zip above for a free car insurance comparison!
Liability Car Insurance
Liability car insurance or proof of financial responsibility is mandated by law in every state. For this reason, almost everyone carries liability car insurance. However, liability only protects your financial assets in the event you are responsible for an accident by paying for damages caused to the other person’s property or person.
If your car sustains any damage in an accident for which you are at fault and you do not carry collision car insurance, then you will not receive any financial help in the costs of repairing or replacing your car.
In the same regard, unless you have medical or personal injury protection (PIP) you will not receive insurance compensation for any medical bills in relation to the accident.
Collision Car Insurance Claims
Collision car insurance is the only way to protect your financial investment in your own car if you are involved in an accident that is your fault. While liability insurance will pay for the other person’s damages, in a collision car insurance claim you will receive compensation for damages suffered by your car.
In addition to paying for your car damage when you are at fault for an accident, collision car insurance claims can be submitted for a few other reasons.
For instance, collision car insurance will cover you whether you hit another car or if another car hits you. Furthermore, it will cover you for any collision that occurs. This is true even if the collision does not involve a second vehicle.
For example, whether your car gets side swiped by another car while parked in a parking lot or if it gets hit by a shopping cart you could submit a collision car insurance claim.
Most lenders will require you to carry collision car insurance during the entire time your car is financed. Once you are no longer obligated to carry collision coverage you may still opt to do so. This is especially true if your vehicle is newer or has substantial value.
Comprehensive Car Insurance Claims
Comprehensive car insurance offers you financial protection for your car for many types of incidents that are not collision related. If you have collision car insurance then your car is covered for damages caused by collision, but it won’t be covered for other mishaps or events such as hail or vandals.
If anything happens to your car that is not related to collision, it is very likely covered by comprehensive. Imagine if your car gets totaled in a fire or it is stolen and never recovered. Without comprehensive insurance you would be at a financial loss as you would not receive any compensation for these events. You can also submit a comprehensive insurance claim for damage sustained by your car due to storms or freak accidents such as striking a deer on the roadway.
As with collision car insurance, lenders require comprehensive car insurance while you are financing your car with them. Most people choose to buy or continue comprehensive coverage even when there is no requirement. The value of the car is usually the determining factor. If your car is old and not worth a lot of money, then it may not be important for you to have comprehensive insurance, but if you cannot afford to repair or replace your car for a variety of potential perils, then it is a good idea to carry comprehensive insurance.
The reason collision and comprehensive insurance are usually bundled together is because together they offer you complete financial protection for your car. With the exception of items that are excluded from coverage, such as a mechanical breakdown, collision and comprehensive together offer you total insurance for impact and non-impact related incidents.
Collision and comprehensive can sometimes be purchased separately depending on how the insurance provider sells it. However, since they are usually purchased simultaneously regardless, being separate or bundled is not usually an issue. The deductible for each is the same whether you have a collision insurance claim or a comprehensive insurance claim.
Choosing the Best Coverage
For complete insurance coverage it is recommended to carry collision and comprehensive along with liability. Additional insurance protection is available by adding medical, uninsured and underinsured motorist coverage as well. In order to get free quotes now from different insurance carriers, enter your zip code now!