A lot of drivers are able to get minimal insurance in their state of residence. Others opt to get further coverage by getting comprehensive auto insurance.
What is comprehensive auto insurance?
Comprehensive auto insurance can protect you from a wide range of situations. It is recommended that all drivers should obtain one. It is an optional coverage that can protect you against the unexpected. It can cover areas where collision coverage cannot. You will be covered from damages against the weather such hails, floods and winds. You are also covered from so-called “acts of God” such as a branch of tree falling on the roof of your car causing damage. Furthermore, you will be paid for if there are incidents such as fire, theft, vandalism by family members and employees, and damage due to improper maintenance. There is a limitation however. Policies covering older cars might exclude comprehensive auto insurance.
In most cases, collision and comprehensive auto insurance are offered in packages. It is possible to purchase the two separately though. However, there are some situations where collision and insurance packages are required especially in the cases of financed cars. If you are borrowing money to purchase a car, it is a wise idea to think of getting a collision and comprehensive auto insurance. This will assure you that you will still have funds available to pay for the outstanding remainder of the loan in case the car is destroyed. There are some lenders that will require proof of this type of insurance before you can get a loan.
In short, comprehensive auto insurance will cover for everything except for collision. Collision insurance will protect drivers from accidents with other vehicles.
Have a high deductible to save money on comprehensive auto insurance.
You can set your deductibles in comprehensive coverage and in collision coverage as well. The minimum can be set at $50 and you can go as high as $2000. Some companies have a standard deductible of $500 while some set theirs at $250. The standard deductible will dictate the cost of your premium. If the cost is below the standard, your premium will go down while if the cost is higher than the standard, it will lower the cost of your premium. If you raise the cost of your deductible, you will be decreasing the rate of your monthly premiums.
Take for instance if the deductible of your car is set at $500 while paying $161 annually for comprehensive coverage. You will simply end up paying $200 annually if you drop your coverage to $200. Dropping your deductible will cause the annual cost to go even higher.
On the other hand, if you raise the deductible to a higher value, the premium will go down. An example would be a deductible of $1000 per claim. The annual premium can go down to $132. If you raise it even further, it will lower the cost of your comprehensive auto insurance. This is also applicable in collision coverage.
What are the other factors that can influence the cost of comprehensive auto insurance?
The value of the car can determine the cost of premiums. Aside from that, there are other factors that can dictate the cost of comprehensive coverage. If your area is prone to frequent occurrences of hurricane and other inclement weather conditions, then comprehensive insurance rates will most likely be higher. Places with high crime rates will also be considered a risk factor because theft and vandalism are most likely to happen in such places.
If there will come a time that the rate you’re paying are too much, then there is a need to think twice if you really need comprehensive car insurance. You can save money this way instead of having to pay for high rates.