What is Comprehensive Car Insurance?
With so many options to enhance your car insurance, how do you know which coverage to add to complement your existing policy? A common option you may see is Comprehensive coverage. So, what is it? Do you need it? And how much does it cost? We'll go over the details to help you decide if this extra coverage is right for you.
What is Comprehensive car insurance and what does it cover?
Comprehensive car insurance is additional coverage that protects your car from loss or damage that's not caused by collision-related incidents. That means this coverage can protect your car from things that are out of your control. Like what? Comprehensive coverage can protect your car against:
- Damage caused from falling trees or objects
- Damage caused by an animal
- Weather-related damage from lightning, windstorms, hail, rising water, earthquakes or fire
Although the list of hazards covered under Comprehensive coverage is generally offered by most insurers, you should still contact your insurance provider to get a better idea on what would be included in your specific policy.
Tip: If you already have Comprehensive coverage included in your car insurance but you're not sure which hazards are covered, look for the "Specified Perils" section of your policy to find the types of damage your car is protected from.
Is Comprehensive coverage mandatory?
If your car is leased or financed, your lender will likely require you to have Comprehensive and/or collision coverage, so in this case it would be mandatory.
If, on the other hand, you've paid for your car outright or you now own the car after finally paying it off, Comprehensive coverage becomes optional. That means you have the choice to opt in or out of having Comprehensive coverage at any time on an active policy. Not sure if you should add or remove it from your car insurance? Here are two factors you can consider:
- Whether you have money available for repairs or to replace your car if it's damaged or stolen.
- The value of your car, factoring in its age and condition.
If you find yourself in a position where you can't afford to fully repair or replace your car if anything (non-collision related) happens to it, you may want to consider having Comprehensive coverage. That way, if any of the hazards mentioned above affect your car, you'd only be responsible for paying your agreed-upon deductible. In contrast, if you drive an older car with pre-existing damage that may not be worth fixing, Comprehensive coverage may not be necessary for you.
When is Comprehensive car insurance NOT available for purchase?
Although it may vary by insurer, there may be factors that'll prevent you from being eligible for Comprehensive coverage. This will depend on:
- The age of the car (e.g., if the car added to your policy is over 15 years of age or older. However, if it's been appraised within the last 12 months, you may still be eligible);
- The car's value (factoring in depreciation and the type of car you drive)
- The car's condition (e.g., if the car has undergone modification for personalization/aesthetic purposes or in contrast, the car has worn out parts).
How much will Comprehensive coverage cost?
The cost of your coverage will depend on your insurer, the province you live in, and of course, your premium and deductible amount. Since Comprehensive coverage is generally an add-on to your policy, it will be an additional cost on your existing policy and will be subject to a deductible.
If you choose a smaller deductible amount for your Comprehensive coverage, the cost of your premium will increase. That means your overall insurance policy will cost you a bit more, but you'd only be responsible for paying the small deductible if you file a claim. If, however, you choose a higher deductible amount, it may result in lower premiums, but you do risk paying more out of pocket if something happens to your car.
How do I get Comprehensive coverage?
Although it's most common to add this to your policy when you purchase or renew your car insurance, you can still add it any time, as long as your policy is still active. If you're looking to enhance your car insurance with Comprehensive coverage, start by getting a quote and following these steps to get the coverage that fits your needs.