What's included in comprehensive coverage, and what should my deductible be?
What does comprehensive coverage include?
If your car is damaged by some event other than a collision or your car is stolen, comprehensive coverage will pay for the damage. Damages may result from fire, windstorm, flood, animal contact, or vandalism. You will have a deductible for comprehensive coverage, as you do with collision coverage. This means that you are responsible for paying the amount of the deductible before the insurance company is responsible for payment. For example, if the cost to replace your stolen car is $10,000 and you have a $500 deductible, your company will pay $9,500 toward the replacement cost.
Comprehensive coverage may also apply to a rental car when you are on vacation. Check with your company before you rent, so that you can decide whether you need to purchase additional coverage.
What deductible should I choose for comprehensive coverage?
Choosing a higher deductible ($500 or $1,000) could help you save a little money. However, because comprehensive coverage makes up a comparatively small part of your premium, you may not save much, unless your premium is very high. And, as always, it's a trade-off between saving money on your annual premium and having to pay the deductible if you have a loss.
Suppose you choose a $500 deductible instead of $250. You may save $100 a year in insurance premiums, so if you don't have a loss for 5 years, that's a total savings of $500. However, if you have a loss during the 3rd year and you have to pay the higher deductible of $500, you haven't saved anything. So, what should you do? Compare how much you can save by checking the price for a few different deductibles when you get a quote. Some companies offer big savings for higher deductibles, while others don't.
