Making Sense out of your Comprehensive Car Insurance

May 7, 2017 · Posted in General 

If you have ever wondered how does comprehensive insurance on your car work, this article will provide some answers. To start with, you need to understand that there are four components to comprehensive insurance: the limit, deductible, coverage and claims.

Car Insurance Area of Coverage – Own and Third Party Damages
The insurance policy’s limit is the first thing you’ll want to investigate. There are two components to this. First, how much would it cost to repair or replace your car if there was an accident? You will want your coverage to cover this at a minimum. Secondly, there are the medical costs if someone else were to get hurt in an accident. Anything over the limit comes out of your pocket.

Deductibles aka Excess

Next up is the deductible. The deductible is the amount you pay before the insurance kicks in. The higher the deductible, the less you pay in monthly insurance premiums. A $500 or $1000 deductible is standard. If you have tickets or accidents on your record and your insurance is sky high, you might consider a higher deductible to lower the cost of insurance.

Protection against Natural Calamities?
The next thing to consider is coverage. Coverage protects you when you are not in the car itself. For instance, if a tree falls and smashes your roof in or a vandal smashes your window, you may have recourse through coverage. Know that this isn’t the same as your liability insurance and doesn’t cover accidents.

Claims Processing
Finally, there is claims. This is basically customer service and it can vary widely from company to company. Consider whether the insurer is going to pay promptly or drag their feet, whether they are fair with their payment amount or make you fight for what you paid for, and whether they will send you to a quality repair shop should something go wrong.

If you are thinking of getting insurance beyond the strict liability policies required by most states, look into comprehensive insurance. And that is the answer to how does comprehensive insurance on your car work?

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