Throughout this series, we analyzed the importance of ensuring that the limits found within your auto insurance policy are enough to protect you and others in the event of injury or loss.

What coverages, however, apply to your vehicle? What if your car strikes another vehicle or other object? What happens if your vehicle is damaged as a result of a fire or flood? Is there an out-of-pocket expense to repair your vehicle?

Let’s examine which parts of your auto policy provide answers to these questions.

Collision Coverage, Comprehensive Coverage (Other than Collision), and Deductibles

Collision coverage, as you may have guessed, is defined as the upset of your covered auto or its impact with another object. Examples of this coverage include colliding with another vehicle, tree, guard rail, etc., or the overturning of your vehicle. While this coverage is not required by law, most loan or leasing companies (usually banks) will require this coverage.

What happens when the damage to your vehicle as a result of a collision is your fault? What if you are struck by a hit-and-run driver? If your auto policy includes collision coverage, it will help pay to fix or replace your vehicle.

Comprehensive coverage (Other than Collision) is (you guessed it) any type of loss that is not collision. Examples include, but are not limited to damages caused by:

• Vandalism
• Hail
• Water
• Flood
• Contact with an animal
• Breakage of glass

Like collision coverage, comprehensive coverage is not required by law; however, most loan or leasing companies (usually banks) will require this coverage.

Both collision and comprehensive coverages include their own deductible, which is outlined in your auto policy. What is a deductible? Quite simply, it is the amount of out-of-pocket expense (money) owed by you before the insurance company pays its portion to help repair damages to your vehicle. Still confused? Let’s look at an example.

Scenario: Your car receives significant damage after colliding into a guard rail. You drive your car to a repair shop where the adjuster is happy to announce that the cost to fix the damage is $3,000. The collision coverage portion of your auto policy includes a $500 deductible, which you pay out-of-pocket. Your insurance carrier pays the outstanding cost ($2,500) to repair your vehicle.

Similar to liability limits, it is important for you to determine the appropriate level of your deductible. For example, raising your deductible amount (out-of-pocket expense) lowers the cost of monthly premiums, while lowering your deductible raises premiums.

Does your current auto policy include collision and comprehensive coverage? Are you comfortable with or know of the current deductible amount?

If you are unsure or answered “No” to any of these questions, it may be time to speak with an expert who is here for you. Contact our Experts  by calling (412) 281-1842.