Comprehensive vs. Collision Coverage
Collision auto coverage pays for crash-related car damages from collisions with other vehicles or objects, while comprehensive auto coverage pays for non-crash-related car damages.
Driving a vehicle as part of your small-business operations can feel like a slower-speed auto race as you rush to meet customer needs and deliveries. But before you hit the gas, know the difference between comprehensive and collision coverage. Comprehensive auto insurance can help with non-crash-related damages, while collision auto coverage can save the day after a fender bender.
Both types of auto insurance can work like your pit crew, ready to step in when you need help. Learn the differences and similarities between comprehensive and collision auto coverage and which to consider for your company vehicle.
Comprehensive auto coverage pays for non-crash-related car damages including:
So if you park your company car on the street and a hailstorm breaks out, riddling the vehicle in hail dents, comprehensive auto coverage could help cover the cost of repairs.
Comprehensive auto insurance is optional coverage. However, it may be required in some cases if you lease or haven’t paid off your vehicle. While some types of insurance allow you to choose a coverage maximum, most comprehensive insurance covers the vehicle’s cash value at the time of the incident. For example, you cannot receive a $50,000 comprehensive insurance policy payment on a car worth $30,000.
Collision auto coverage pays for crash-related car damages from collisions with other vehicles or objects. It covers fender benders, backing into a barricade, and even getting stuck in a pothole. We’ve all been there. For example, suppose you swerve your delivery truck to avoid hitting a stray cat and hit a yield sign instead. In that case, collision auto coverage could help cover the repair shop bill. (Good for you and the cat!)
Collision auto insurance will help cover repair damages on your vehicle no matter who is at fault in the accident. However, it doesn’t cover the damages to other cars involved. Auto liability insurance — a requirement in most states — will cover any damages you cause to other vehicles. Like comprehensive coverage, collision insurance will only pay out as much as your car is worth or the cost of repairs.
There are some key differences and similarities between comprehensive and collision coverage to keep in mind when shopping for an auto insurance policy.
The majority of drivers with auto insurance buy collision coverage and comprehensive coverage (74% and 78%, respectively).1 But why do you need both comprehensive and collision auto insurance?
If your company vehicle is financed or leased, the lender will likely require you to purchase both comprehensive and collision coverage to ensure you don’t walk away from your financial obligations if your leased car is totaled or stolen.
Cars paid in full don’t require comprehensive and collision coverage, but you may still want the coverage. For example, if someone steals your fancy new delivery truck from your parking lot, would you be able to replace it out of pocket? If not, it would be beneficial to have a comprehensive policy to help cover the expense of purchasing a new truck.
Comprehensive and collision insurance are key players in your business’s pit crew. Most commercial auto insurance policies include both types of coverage, which means you can get all your needs met in one simple policy.
While comprehensive and collision insurance work together to cover the expenses of a wide array of damages, there are still a few things these policies don’t cover:
Comprehensive and collision coverage are vital resources to have when things go wrong on the road. You wouldn’t drive without a spare tire, right?
At Thimble, we can help you navigate the road to coverage with a clear set of directions to get small business insurance. Simply click “Get a Quote” or download the Thimble mobile app, answer a few easy questions, and you can get covered within minutes. Drive confidently with an expert insurance pit crew on your side!