When you call your car insurer, you might want as much coverage as possible. Therefore, you might ask them for comprehensive car insurance. However, be careful; comprehensive coverage means a very different thing to most insurers than it might to you. Comprehensive coverage, along with its counterpart, collision coverage, is part of a greater portion of your policy called physical damage insurance. It’s certainly important to have physical damage coverage on your policy, and here’s why.
What’s Physical Damage Insurance
Most states require drivers to carry certain types of car insurance. Florida, for example, requires drivers to carry personal injury protection (PIP coverage) and property damage liability (PDL) insurance. PIP coverage allows the driver to pay for the costs of their own medical bills following a wreck. PDL coverage helps them compensate other drivers for the damage they cause them if they are at-fault for a wreck.
However, neither type of coverage will pay for damage to your car following any type of damage. To get that coverage, you’ll likely have to add physical damage coverage to your policy.
Physical damage coverage is part of your policy that pays for your vehicle damage following both wrecks and other types of accidents. It can help you both repair vehicle damage or receive compensation for a totaled car. Therefore, it’s critical protection to help you get back on the road after damage occurs.
There are two types of physical damage insurance—collision and comprehensive coverage.
Collision insurance applies to your vehicle’s damage if that damage results from a wreck or other type of collision with another object. The types of collisions covered under this part of your policy can include wrecks with other vehicles, in addition to collisions with buildings and certain other objects.
Your comprehensive coverage applies to vehicle damage that results from hazards other than collisions. For example, the policy might pay if the car sustains damage following:
- Fires (including fires originating in the car itself)
- Weather damage, such as hail, lightning strikes and water damage
- Vandalism by third parties
- Theft of the car
- Collisions with animals
The Limits of This Policy
Even though these policies can offer you a lot of help, they will include certain restrictions on when and how much they will pay you.
- If you intentionally damage your car, the policy likely won’t pay.
- Most auto policies pay only the actual cash value (ACV) for a totaled car. Since most cars depreciate in value over time, then you might not receive a settlement for the cost of a new car. You might only get the depreciated cost of the car at the time of the accident.
- Physical damage insurance will have deductibles attached. Even if you total the car, the insurer will likely subtract the cost of the deductible from your settlement cost.
Keep in mind, if you are not at-fault for a car wreck, you might be able to make a claim against the other at-fault party’s liability insurance. This can help save you from making a claim on your own physical damage coverage.