How much you drive — or your annual mileage — is an influential rating factor in places like California but can still positively and negatively affect your premium in other states. If you live in California, you can expect a 25% gap in average annual premiums between those who drive up to 7,500 miles a year and those who drive more than 15,000 miles a year. On average, the less you drive, the more it saves you — but this impact is minor.
Comprehensive auto insurance covers damage caused by incidents other than a car accident, including theft, fire, vandalism, weather, falling objects and animal damage. It isn't required by law, but it may be a good idea depending on the value of the car you're driving. In fact, drivers of leased or financed cars are often required to obtain this insurance in order to protect the car owner or lender's investment. Although separate from collision insurance, a driver must typically have collision insurance in order to be able to purchase comprehensive coverage [sources: Allstate, Maine Bureau of Insurance].
Let's use the aftermath of Superstorm Sandy as an example to illustrate the differences between collision and comprehensive. Within that storm, let's consider two events that might have happened: 1) a heavy tree branch fell on your car, or 2) you swerved to avoid a falling tree branch and wound up crashing into a tree. In the first event, you had no control over when or why a tree branch would fall on your car. This kind of accident would get reimbursed under your comprehensive policy. In the second situation, you were driving the car and ultimately swerved into the tree, which makes it a collision, and collision insurance therefore pays for the damages. Events like the hypothetical ones stated above are why it's important to differentiate between the two types of coverage.
Insurance companies place substantial weight on your credit score, using it to determine risk. Studies by the Federal Trade Commission (FTC) show drivers with low credit scores not only file more claims than drivers with higher credit scores, but the actual dollar amount is greater than higher-scoring drivers. Thus, those with better credit are safer clients — with more affordable premiums. On average, moving from one credit tier to the next among our selected insurers saves an average of $344 in annual premium payments.
The cost of comprehensive insurance coverage varies greatly by location, but the average annual premium for comprehensive coverage countrywide is $148 per year ($12 per month). The most expensive place for comprehensive coverage is Washington, D.C., where it’s $233 per year ($19 per month). The cheapest state is Maine, where the average cost is $104 per year ($9 per month).
Coverage limits determine the most an insurance company will pay for a covered claim and comprehensive insurance does have limits. The limit on comprehensive insurance coverage is typically the actual cash value of your car. If your car were stolen, your comprehensive insurance policy would reimburse you for your car’s depreciated value. If you wanted to replace your stolen car with a new model, you would have to use money out of pocket in addition to the reimbursement.
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Type of car: If you have an expensive or powerful car then you are seen as a higher risk for a number of reasons. If it’s expensive, it has a higher risk of being stolen. If it’s powerful, it’s deemed more at risk of getting into an accident driving at speed. If you want to see how your car impacts your insurance, you can check which insurance group it’s in for an indication.
If you live in an area prone to car theft and vandalism, you'll probably sleep easier with comprehensive coverage at your side. Though car theft numbers have steadily decreased over the last several years in the U.S. — actually dipping below 700,000 reported cases in 2013 for the first time since 1967, and remaining at those levels the years following — the odds are still less than encouraging.
When you purchase comprehensive coverage, you will select a set deductible, which is the amount you pay out of pocket toward a covered claim. Let's say you choose a $500 deductible, and your car is later damaged by hail in a covered claim. If it costs $1,500 to repair your car, you would pay your $500 deductible, and your insurance would pay the remaining $1,000.
This discount refers to the manner in which you make your insurance payments and has tiers, typically. For example, if you pay your entire premium up front, you are often given a discount: the highest preferred payment discount. A paid-in-full discount can save you $62 per year on your auto policy. Moreover, if you set up automatic payments from a bank account, you can often receive an Electronic Funds Transfer (EFT) discount.” An EFT discount can lead to savings of about $28 annually. If you are able to pay upfront or through automatic payments, this is a great way to get cheaper car insurance.
Insurance terms, definitions and explanations are intended for informational purposes only and do not in any way replace or modify the definitions and information contained in individual insurance contracts, policies or declaration pages, which are controlling. Such terms and availability may vary by state and exclusions may apply. Discounts may not be applied to all policy coverages.
Some insurance companies will offer a discount based on your occupation. Statistically, some occupations — teachers, physicians, or police officers — are less likely to file a claim and thus pose less risk. Because of this, some insurance companies return the savings back to you. Usually, they will require proof of your profession, such as a photocopy of your professional degree or certification.
Hi Stephen – I think you’re doing the right thing – as long as the premium continues to be reasonable compared to the competition. Even though we obsess on low rates, quality of service matters. It does little good if you get the cheapest policy, then they stick you when you have a claim. With must auto claims there’s going to be a human error factor (especially with new drivers), and you can’t be with companies that will hold that against you to such a degree that it seems like they no longer want your business.
Liberty Mutual just dropped my family because of two claims that were made on my daughters car. She had her car at school freshmen year and It was parked and hit on the rear corner closest to the road. It wasn’t her fault and no one came forward to admit to the accident. She no longer has a car at school, and drives rarely when she’s home. The second accident was when she was pulling out of the carport and her front bumper caught a wooden railing when she was backing out. That was her fault, but an accident. Isn’t that why we have insurance????? Before I got this letter from Liberty mutual, I sang their praises. I will loudly have bad things to say from now on. Don’t count on Liberty Mutual
To calculate the added cost in purchasing comprehensive and/or collision coverage we looked at annual insurance quotes for a 30 year old male from New York across four different insurance companies, and the ten best-selling vehicles in the US. We look at the range of rates you could pay from basic liability to policy plans with comprehensive and collision coverage. Collision typically costs more than comprehensive, although some companies require you to carry both rather than just one. Comparing quotes across at least three companies can get you lower car insurance rates.
The best car insurance companies have a few things in common: They have straightforward shopping experiences, take good care of policyholders after a crash and treat their customers with respect and courtesy. That means only insurers with high customer satisfaction scores and relatively few complaints to insurance commissioners make it to the top of our list of the best auto insurance companies.
Matthew thanks for posting this. You’re absolutely right. USAA has gone down the tubes, I dont get it, a simple claim recently for auto, turned into a nightmare. bouncing my calls all over the country with a bunch of idiots for claim reps answering the phones, and forcing my car into total loss when it should not have been, and paying only a portion of the damage even though I have collision.
Telematics — or usage-based insurance — is a growing trend in the insurance industry. These programs track your driving habits via an in-car device. Your car insurance rates will be determined by your driving habits, including speed, mileage, and other factors, rather than your age, credit history, or location. Some insurers offer major discounts for good drivers using telematics-based insurance.
The Insurance Information Institute (III) recommends that a good formula for deciding if comprehensive coverage is worth it is to multiply your yearly comprehensive premium by 10. If the resulting figure is higher than your car’s value, it may not make sense to buy comprehensive insurance (you’d be better off saving that money in an emergency fund).
Comprehensive insurance and collision insurance are commonly mixed up. Both types of insurance coverage insure your car however they cover different events. Collision insurance covers car accidents while comprehensive insurance covers circumstances outside of your control, such as natural disasters and animals. One way to distinguish the difference between the two is thinking of collision insurance as your car colliding with something (other than an animal), and comprehensive insurance is everything else. Accidents involving animals are considered out of your control and covered by comprehensive insurance. Comprehensive coverage doesn’t include everything, but if you have concerns about your car hitting an animal, theft or vandalism, you should consider upgrading your policy today. Learn more about a quote from the AARP Auto Insurance Program from The Hartford today.
Our data shows that 7% of Progressive drivers with comprehensive coverage have a comprehensive claim in a given year, and the average repair is about $1,400. Without comprehensive, that's how much you may have to pay out of pocket. Keep in mind, repair costs can vary widely based on your damage and how much your car is worth. Typically more expensive cars cost more to repair.