What is Comprehensive Car Insurance?

Comprehensive car insurance policies pay for damages to vehicles resulting from things that are not your fault. They provide financial compensation for damage or loss due to theft, fire, vandalism, hitting an animal, flying objects, broken glass and most damage due to natural disasters. Comprehensive car insurance policies cover most things that could damage your vehicle when you are not driving it. If you suffer damage as a result of your negligence or your actions, other types of insurance like liability and collision must cover that damage.

Comprehensive car insurance policies do not cover everything. Every policy lists exclusions that are not protected under the agreement. Some typical exclusions include electronic equipment that is not permanently installed in the vehicle, CDs and other media and radar detectors. Comprehensive car insurance policies also often exclude custom equipment and accessories like trailers and camper shells. Policies can also be voided if the vehicle was being used in illegal activities and was seized by police.

Comprehensive car insurance policies are designated with a set coverage amount. This is the most an insurance company will pay to compensate you for each comprehensive damage claim. Most insurance companies have set tiers of coverage amounts. The standard comprehensive car insurance coverage amount is usually $100,000. Customers have the option of raising or lowering that amount. The higher the coverage, the higher the comprehensive car insurance premiums will be. Some people choose to lower their comprehensive car insurance coverage amount to save money on their automobile insurance bill. Comprehensive car insurance coverage is sometimes listed as "property damage" on some automobile insurance policies. This is because the comprehensive insurance limit also applies to the collision coverage limit.

Most comprehensive car insurance policies come with a deductible. This is the amount that you must pay to repair or replace your vehicle before the insurance company contributes any money. Deductibles discourage people from using comprehensive car insurance policies for small damage claims. The typical comprehensive car insurance deductible is $500. Customers have the option to raise or lower the deductible amount on their comprehensive car insurance policies. When the deductible is raised, the the comprehensive car insurance premiums are reduced. Some comprehensive car insurance policies allow customers to eliminate the deductible altogether. Doing this will significantly increase the amount paid to maintain the policy.

Comprehensive car insurance policies are optional. Unlike liability car insurance, the law does not require that vehicle owners have comprehensive car insurance. However, if a vehicle is leased or a lender has a lien on it, getting comprehensive car insurance is usually required as part of the lease or loan agreement.