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Comprehensive insurance pays to repair or replace your car if it's stolen or damaged in incidents where you aren't at fault. It's typically required if you finance or lease your car, and optional if you own your car outright. Either way, many car owners opt in: 79% of insured drivers purchase this type of coverage in addition to liability insurance, according to the Insurance Information Institute (III). Here's what to know about comprehensive car insurance and whether you should buy it.
What Is Comprehensive Insurance?
Comprehensive car insurance is a type of coverage that financially protects your car in situations outside of your control, such as weather disasters and theft. You can add comprehensive to an existing policy but typically not as standalone coverage.
If you make a comprehensive insurance claim, you'll pay the deductible that you chose when you took out the policy. Your insurance company will cover the rest of the cost of repairing or replacing your car, up to its current value.
What Comprehensive Insurance Covers
You should always check your policy for details, but comprehensive insurance generally covers the following incidents:
- Fire
- Explosions
- Theft
- Damage resulting from theft
- Windstorms
- Floods
- Hail
- Vandalism
- Contact with an animal
- Glass breakage
- Windshield damage
- Falling objects
- Lightning
- Earthquakes
- Violence from civil unrest or riots
What Comprehensive Insurance Does Not Cover
Comprehensive coverage usually won't cover damage from the following incidents:
- Accidents with another vehicle
- Hitting another object
- Your car rolling over
- Wear and tear
- Mechanical problems
- Items stolen from your vehicle
- Liability or medical costs
- Damage from potholes
Comprehensive vs. Collision Insurance
Collision insurance pays to repair or replace your car if it's damaged in a collision with another vehicle or object. Comprehensive insurance essentially covers you against everything else that can happen to your car. In fact, comprehensive is known as "other than collision coverage" because it typically covers your car against every type of incident—with the exception of collisions with other vehicles and objects.
Between the two types of coverage, collision typically costs more—$290 per year on average versus $160 per year for comprehensive coverage, the III reports.
Do You Need Comprehensive Insurance?
Comprehensive insurance isn't required by law in any state—so if you own your vehicle outright, you can decide whether to buy the coverage. You may want this type of insurance in the following situations:
- You park your car on the street or in an area with a high crime rate.
- Your area is prone to natural disasters like hurricanes and wildfires.
- You commonly encounter animals while driving.
- You drive an expensive car.
- You don't have the cash to repair or replace your car if it's stolen or damaged.
If you lease or finance the car, your lender may require you to buy comprehensive and collision coverage.
Once you pay off the car, you can decide whether to keep comprehensive insurance. A standard rule of thumb is to drop comprehensive and collision coverage if your car is worth less than 10 times the annual premium for the two coverages combined. So, if your annual premiums for both types of coverage is $400, it may be more worthwhile to drop both types of coverage if your vehicle is worth less than $4,000.
How Much Does Comprehensive Insurance Cost?
The average cost of adding comprehensive coverage to a policy for one car is about $160 per year, according to the III. But prices vary among insurance companies because each provider has its own formula for setting rates. Insurers also consider other factors, such as your age, ZIP code and gender, when calculating your premium. So the cost you pay may differ from what another driver pays.
When you get quotes for a car insurance policy, the company should break down the cost of each type of coverage you're considering. You'll be able to check how much you're being charged for comprehensive and compare it against other insurers. There are ways to save money, too, like increasing your deductible or taking advantage of discounts.
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How to Get Comprehensive Insurance
Getting comprehensive insurance is relatively straightforward. You can either add the coverage to your existing policy, or gather auto insurance quotes that include comprehensive coverage and compare them side by side. Make sure you choose the same coverages for each quote so you know you're making a good comparison.
A basic car insurance policy includes the minimum coverage your state mandates, while a full coverage policy typically includes liability coverage as well as comprehensive and collision insurance. You can also adjust your coverage amounts. Insurers may also offer add-on services like roadside assistance, gap insurance and coverage for substitute transportation while your car is in the shop.
The Bottom Line
Comprehensive car insurance can be a good way to financially protect you and your vehicle. It pays to repair or replace your car if it's stolen, vandalized or otherwise damaged by an incident outside your control.
The cost of comprehensive car insurance varies with every insurance company and policyholder, but there are ways to reduce your costs. For instance, some states allow insurance companies to use credit-based insurance scores when setting premium rates. If your state allows this practice, consider improving your credit if necessary before buying car insurance. Start by checking your credit report and credit score for free with Experian and addressing any issues you find on your report.