Collision vs Comprehensive Insurance: What’s the Difference and Do You Need Both?
Collision and comprehensive insurance are optional coverages that help pay for car damage. But they cover different incidents. They are also completely different from liability car insurance, which covers injuries and property damages you cause to others in an accident.
In this comprehensive vs collision insurance guide, we’ll break down what each type of coverage includes, how they differ, and when you might need one or both.
What Is Collision Coverage?
Collision coverage is a type of car insurance that helps pay to repair or replace your vehicle if it’s damaged in an accident, no matter who’s at fault. It covers collision damages, including:
- Accidents involving another vehicle
- Hit-and-run incidents
- Your car flipping over onto its side or roof (rollover accident)
- Crashing into stationary objects like a tree or pole
What Comprehensive Insurance Covers
Comprehensive coverage is a type of auto insurance that covers non-collision damages to your car, which may be caused by:
- Natural disasters such as fire or floods
- Theft
- Vandalism
- Falling objects like tree branches
- Hitting an animal
Key Differences Between Collision and Comprehensive
Comprehensive vs collision coverage: What sets them apart?
| Feature | Collision Coverage | Comprehensive Coverage |
|---|---|---|
| What It Covers | Collision with other vehicles or objects | Non-collision incidents |
| Type of Damage Covered (Examples) |
|
|
| What It Doesn’t Cover | Damage to your car caused by non-collision accidents | Damage to your vehicle caused by collision incidents |
Despite these differences, comprehensive and collision coverage have several similarities. Unlike liability insurance, which pays for injuries and property destruction you cause to others in a car accident, comprehensive and collision insurance only cover damage to your vehicle.
And that’s not all.
Both come with an insurance deductible — the money you agree to pay out of pocket for car damage before your insurer covers the remaining expenses. Deductibles are subtracted from your comprehensive or collision claims. They usually range from $250 to $2,000. The higher the comprehensive and collision deductibles, the lower your insurance premiums.
Additionally, if you have a totaled car after an accident (irreparable or repair cost is higher than the vehicle’s worth), the coverage limits for both comprehensive and collision insurance cap at the actual cash value of the vehicle at the time of loss.
The actual cash value at the time of an accident might be lower than what you owe on a car loan or lease because of depreciation. If you buy gap insurance, your insurance policy will cover the difference between what you owe on your car and the compensation from your collision or comprehensive coverage.
Do You Need Both Coverages? Factors to Consider
If you lease a vehicle or buy one with a loan, your lender may require you to have comprehensive and collision insurance. In that case, you’ll need both coverages.
These types of insurance are optional if you don’t owe any money on your car. Evaluating the factors below will help you decide whether purchasing both comprehensive and collision coverage is right for you:
- The value of your car: If the vehicle is badly damaged or gets stolen, can you afford to pay out-of-pocket to repair or replace it? If not, both coverages might be right for you.
- Parking location: Cars regularly parked in busy, high-crime-rate areas are more likely to be stolen, vandalized, or involved in accidents with other vehicles, making collision and comprehensive insurance coverage crucial.
- Local weather conditions: If your area is prone to adverse weather conditions that increase the risk of collision and non-collision damages, both coverages are worth considering.
- Driving frequency: If you drive often, buying collision insurance makes more sense than getting comprehensive coverage. However, other factors, like the ones discussed above, may determine whether or not it’s a good idea to have comprehensive insurance.
If your vehicle is too old, the cost of coverage might exceed the car’s actual value. In that case, dropping one or both types of coverage may be cost-effective.
How Much Do Collision and Comprehensive Coverages Cost?
How much you pay for collision and comprehensive insurance depends on many factors, including your:
- Car type and model
- Driving habits (how often you drive)
- Driving record (license suspension, number of accidents involved, etc)
- Age
- Deductibles
It’s best to get tailored rates and compare them. That way, you can choose the most affordable insurance option.
But generally, how much can you expect to spend on collision or comprehensive coverage?
According to the Insurance Information Institute, the average cost of collision coverage in the United States is $290 per year. On the other hand, the annual comprehensive insurance premium is approximately $134.
Is This Coverage Required? Legal and Lender Requirements
Collision and comprehensive insurance aren’t legally required in any state. However, if you lease or finance your car, your lender may require you to carry one or both types of coverage until the lease ends or the loan is paid off.
Tips for Deciding What’s Right for You
Collision vs comprehensive insurance: How do you choose the right type of coverage?
- Check lender requirements: If you lease or finance your vehicle, your lender probably requires collision or comprehensive coverage (or both).
- Consider your car’s worth: Collision and comprehensive coverage are worth it if your vehicle is new or high-value.
- Factor in your driving habits: Do you drive daily? If yes, collision coverage can be a smart move. If you drive occasionally, consider comprehensive coverage against non-collision-related risks.
Compare Quotes to Find the Right Protection for Your Vehicle
Collision and comprehensive insurance rates depend on your zip code and driver profile (age, marital status, education, etc). The best way to get affordable insurance is to compare custom options.
EverQuote provides free collision and comprehensive coverage quotes tailored to your needs. In just a few minutes, you can gauge car insurance premiums from different providers in your area to identify the cheapest option. Get custom quotes today.