What is the difference between collision and comprehensive insurance?
September 19, 2019
Buying insurance for your brand-new car? Find out the difference between comprehensive and collision insurance and which one you need.
You’ve just bought your brand new car that you had always dreamed of. But before you can take it for a spin, you need to complete some paperwork, like registration, which requires that you register your vehicle with the local R.T.O., and your car insurance. It is compulsory by law that you get your vehicle insured before you can drive it on Indian roads. Like any insurance, vehicle insurance is offered by a plethora of different insurance companies that have many different types of insurances. Read on to find out the two main types of vehicle insurance, and whether you need any one of them or both.
The first type of insurance is the collision insurance. As the name suggests, a collision insurance coverage pays for damages to your car in the event of a collision with another vehicle or object. This usually includes a complete repair job of your vehicle. A collision insurance does not cover damages to your car for any other unfortunate events, like damage due to weather, vandalism or theft.
Covers damages due to:
- Collisions with other vehicles
- Collision with trees or potholes
A comprehensive insurance coverage pays for damage to your vehicle for a comprehensive list of events other than a collision, like theft, vandalism, weather conditions, etc.
In case your car suffers damage from a fallen tree, your windshield breaks, or someone tampers with your car, your comprehensive insurance will pay for the damage.
Covers damages due to:
- Falling objects like tree branches, hail, etc.
- Natural disasters like flood or fire
Comprehensive and collision insurance: Which one to buy?
Deciding which one of the above you need, or whether you need both, depends on the following factors:
Car Value and Maintenance Cost
If your car is brand new and on the expensive side, it is better to go with both these types of insurance. Also, if the maintenance cost of your car is high, then it would be a pain to pay for any minor or major damages out of your own pocket. The better option is to go for both collision and comprehensive insurance, so that you are covered for anything unfortunate that happens to your car, regardless of whether it falls under collision or comprehensive insurance.
If your daily commute is longer and you drive your car more frequently, the risk of collision increases. In that case, you should prefer insurance that offers collision coverage.
Your home or office location
You have to factor in where your car will be parked for most of the time. If the location where your car is present is known for theft and vandalism, or if the area contains lots of large trees that may drop branches during bad weather, then a comprehensive coverage is your best bet.
Thus, it is important to know the difference between comprehensive and collision auto insurance. Use this article as a guide and choose an insurance that best suit your needs.