Do I Need Collision and Comprehensive Insurance?
Whether it’s navigating the highways or sitting in what you believe to be a safe and secure garage, the dangers that your car will face are hard to quantify and harder to predict. When a car accident forces you to repair or replace your vehicle, comprehensive and collision insurance coverage can be of invaluable assistance, and each has a particular role to play.
How do these types of coverage work? Is there any overlap, and will one do the trick without the other?
What You Can Expect from Comprehensive
Before you can think of adding collision coverage, you must have comprehensive. This is just as well because despite its many virtues, collision coverage is limited in scope and unable to deal with every eventuality. Comprehensive coverage, on the other hand, will have your back when vehicular damage results from:
- Animal strikes.
- Falling objects.
- Natural disasters.
After you have met your deductible, comprehensive insurance will generally pay the balance of whatever it costs to repair or replace your vehicle up to but not exceeding its actual cash value.
What Collision Coverage Can Do for You
Collision coverage is intended to compensate you if your car should roll over, hit another object or crash into someone else’s vehicle. It will do this even in cases where you’ve caused the accident yourself. The dollar amount of your reimbursement will equal your car’s current book value minus your policy’s stated deductible.
Certain caveats apply. Chief among them is the fact that collision coverage will only apply to repairing or replacing your own car. If there is any corollary damage, your liability coverage must handle it.
In addition, if you were hoping to acquire collision coverage on its own, you’ll be out of luck. Only those who already carry comprehensive can choose to add collision. Many who appreciate the additional level of security routinely elect to do so.
Collision Deductible Waivers
When an accident happens through no fault of your own, the other driver’s auto insurance should cover your costs. This will only happen, though, if that person actually carries insurance. If he or she does not, your own collision coverage will pick up the slack, although in most cases, you’ll still have to pay your deductible.
For those who’ve had the foresight to add a collision deductible waiver to their auto insurance policies, this won’t be the case. The waiver will relieve you of the need to meet that unwelcome expense.
Your Vehicle’s Actual Cash Value
If you should ever need to make a claim, your comprehensive or collision insurance will only reimburse you for as much as your car is worth at the time. Its actual cash value will always equal its original purchase price minus depreciation. Because your car lost in monetary worth the moment you drove it off the lot, its book value at any point in time will never equal the amount you originally paid for it.
Insurance deductibles are a fact of life, but their dollar amounts are rarely written in stone. The choice is up to the purchaser. The selection of a higher deductible will lower your premium payments. It will also, however, raise your out-of-pocket costs if and when you need to make a claim.
The law does not require Nevada residents to carry collision or comprehensive, but few finance or leasing companies will excuse their clients from meeting the obligation. The advantage of carrying the two together is that one will kick in where the other leaves off. For this reason, even people who own their vehicles free and clear often choose to carry both types of insurance just for the extra protection.
If you have any questions about collision and comprehensive coverage, the insurance brokers at All Kinds of Insurance are here to help. Feel free to contact us at 702-534-4697 any time for assistance with your car insurance needs.