How can I differentiate between collision coverage and comprehensive coverage?


Auto insurance has a lot of parameters that you need to consider. If you have thought about it, there are quite a lot of aspects to it that you can choose from and could potentially help you to significantly reduce the insurance coverage. Two important factors in this regard are comprehensive and collision coverage. These are two features that you have an option to choose from in the package that you choose for your vehicle. Depending on your budget, you can choose whether or not you would want to go in for this kind of coverage.

First, you need to understand the difference between the two parameters. Collision coverage refers to the costs incurred when your vehicle is involved in an accident. It might not always be necessary for companies to pay for having your car repaired and fixed. Usually, you can choose whether or not if you want this since some people often want just basic insurance coverage. Repairing your vehicle can be expensive, especially if it is a serious accident. Hence, you need to be sure that you will be able to bring up the money required to fix the vehicle, in case you have to.

Finally, comprehensive coverage refers to coverage in the broader sense. With comprehensive coverage, you can be assured of getting protection for your vehicle no matter what it might be. In fact, comprehensive coverage will pay for your car as well as for any people who are in the car during the time of the accident. Insurance companies have different definitions of comprehensive coverage, and you need to read through the fine lines before signing on any document. In fact, ask the agent to give you a list of things that are not covered even under comprehensive insurance.  Although by definition it should cover the costs entirely, it might not always be true and there might be things that the insurance policy might not always take care of.

Remember that by law, you don’t have to opt for either of these. Although the exact driving insurance laws are different and depend on the state that you are in, having comprehensive coverage is something that is not mandated by any state. Since it does cost quite a bit more to have both these aspects in your insurance policy, no state forces its occupants to have it done for their vehicle. This is something that you can consider if you feel the costs involved are not worth having it.