When Does It Makes Sense to Drop Comprehensive and Collision Auto Insurance Coverage?

Ron Trumbo Insurance Editor

If your car or truck is simply getting old and the blue book value is starting to drop below $1,000 to $2,000, it might be time to have a conversation with your insurance agent about dropping your comprehensive coverage. According to the Insurance Information Institute, comprehensive coverage is commonly a third of total cost of an insurance policy, and collision is about 20%, and the potential savings for not purchasing the coverage could be valuable depending on what kind of car or truck you drive.

Comprehensive and collision auto insurance coverage are different than liability coverage. Also known as “Comp and Collision,” coverage is not always required by states as part of mandatory minimum coverage laws. Collision coverage protects damage to your own vehicle when you’re involved in a collision. Comprehensive coverage on the other hand covers your own vehicle when damage is caused by something other than a collision.

What Comprehensive and Collision Insurance Coverage Protects

There are so many circumstances that can warrant having comprehensive coverage including, vandalism (tires slashed or car keyed), broken windows and windshields, damaged caused by animals (like hitting a deer), falling objects like tree branches, and major storm damage from hurricanes and earthquakes. Of course this list can go on and on, and this is why you need to understand all the exclusions within your policy for comprehensive coverage. Collision coverage protects against damages caused any collision with another vehicle or object. Additionally, collision insurance covers you in a vehicle rollover.

Comprehensive Coverage is NOT an Auto Warranty

Although comprehensive coverage protects against a myriad of causes not related to collisions, it is not a fix-all auto warranty policy. Comprehensive coverage does not cover vehicle damages caused by normal wear and tear like engine breakdown or flat tires.

Comp and Collision Has a Separate Deductible

Similar to liability auto insurance, comprehensive and collision coverage have a deductible. For more information, see InsuranceLoco’s article: Car Insurance Deductible: $250, $500 or $1,000? How Much Deductible Do You Need?