Comprehensive vs. collision insurance

Figuring out your auto insurance options can be confusing. Most states require you to have some sort of auto insurance policy, and if you have a loan or a lease on a vehicle, you're probably contractually required to go beyond minimum coverage.

Two of the most important terms to understand are comprehensive insurance and collision coverage.

• Comprehensive insurance refers to a broad type of automobile coverage that reimburses you for vehicular loss or damage that wasn’t caused by a collision. For example, vandalism would be covered by comprehensive insurance but not collision insurance.
• Collision insurance helps pay for costs associated with automobile collisions. Pretty much all lenders require this type of insurance when you lease or finance a vehicle. Once the vehicle is paid off, you can decide whether or not you keep this coverage.

What does comprehensive insurance cover?

Comprehensive insurance covers loss or damage from natural perils, theft and vandalism, including glass claims and windshield repair. This means your comprehensive insurance policy should cover you if, for instance, your car is stolen, damaged during a storm or hit in the windshield by a rock on the highway.

Comprehensive insurance covers loss or damage from natural perils, theft and vandalism.

Generally, comprehensive plans can cover your vehicle against damage that results from:

• Fire
• Theft
• Vandalism
• Civil disturbances and riots
• Natural disasters (e.g., hurricanes, hail, tornadoes)
• Falling objects (e.g., tree limbs)
• Damage from animals

Note that hitting an animal, like a deer, while driving is covered by comprehensive insurance, despite the fact that it’s technically a collision.

What does comprehensive insurance not cover?

If you’re interested in comprehensive coverage, check the details of any policy you’re considering before you sign up. There are usually coverage limits, meaning you might not get full reimbursement for all costs associated with the situations above.

Broadly speaking, comprehensive insurance doesn’t cover vehicle collisions. It won’t even cover you in the cases above if there's also a collision involved. For example, if you’re driving in a snowstorm and it causes you to hit another vehicle, you won’t be covered by a comprehensive coverage plan.

Broadly speaking, comprehensive insurance doesn’t cover vehicle collisions.”

It’s important to note that comprehensive insurance also doesn't cover the damage to another vehicle in the event of a collision — or any medical expenses for people involved in the accident.

While comprehensive coverage does protect you financially after a theft, it doesn’t cover the cost of anything else taken if your vehicle is broken into or stolen. Only the cost of the vehicle itself is covered by this part of your policy.

Comprehensive coverage also doesn’t cover legal bills, lost income or medical bills associated with the covered damages above. This would have to come from your liability insurance. It won’t cover mechanical breakdowns either — that’s what a car warranty is for.

What does collision insurance cover?

If you get in an accident, collision insurance is what helps cover the cost of repairing or replacing your vehicle. Covered accidents might include rolling your vehicle, driving into a tree or hitting other cars.

Collision insurance may also help cover the cost if another car hits you but the driver doesn’t have enough insurance to pay for your repairs. This is one reason this coverage is popular among drivers.

What does collision insurance not cover?

Collision insurance doesn’t cover the cost of anything you damage with your car, whether it's a house, another car or a telephone pole. It also doesn’t cover any other type of damage to your vehicle, like theft, vandalism or natural disasters.

In the event of an accident, your collision insurance policy also won’t pay for any medical or legal bills associated with that collision. You'll need liability coverage for that.

Comprehensive vs. collision insurance costs

Collision insurance is usually a lot more expensive than comprehensive insurance because it’s more likely to be used.

According to the National Association of Insurance Commissioners, average annual insurance premiums for collision insurance are over double the premiums for comprehensive coverage. In its 2018/2019 Auto Insurance Database Report (published in 2022), the NAIC found that national collision insurance premiums averaged $381.43 per year, while comprehensive insurance premiums averaged $171.87 per year.

Both types have roughly similar ranges for average deductibles, but collision insurance is more likely to have $0 deductible options available. If you opt for both types of coverage, you can actually have different deductibles for each.

... average annual insurance premiums for collision insurance are over double the premiums for comprehensive coverage.”

When deciding if these coverages are worth the cost, first figure out how much your car is really worth using an online car buying site. For example, if your vehicle is worth $1,500, having collision coverage with a $1,500 deductible isn’t worth it. However, if you have a $65,000 truck, getting both types of coverage is probably worth more in the long run.

Factors to consider

There are a variety of factors to consider when deciding what coverage you need.

Comprehensive vs. collision insurance

Some people choose to have both comprehensive and collision coverage for their vehicles. However, you don’t have to get both, and there are a few reasons why you might choose one over the other after considering your risks and your budget.

*Based on the NAIC’s 2018/2019 Auto Insurance Database Report

Bottom line: Do I need comprehensive and collision auto insurance?

The bottom line is that if you're financing your car (making payments), your lender likely requires collision and comprehensive coverage. If, however, your vehicle is paid off, you have a choice.

The amount of coverage you should have largely depends on how valuable your vehicle is.”

The amount of coverage you should have largely depends on how valuable your vehicle is. Calculate your vehicle’s value based on its mileage and condition minus your deductible. Balance this possible loss versus the cost of collision and comprehensive auto insurance coverage (or either one) to see where you come out ahead.

Compare quotes from multiple companies and ask if any discounts are available. The more companies you talk to and let “bid” on your automobile insurance, the more likely it is you'll end up with the right policies at the right price.