What is it, and what does it cover?
Whether you just got your first car, or you’re an experienced driver, it’s always worth giving some extra thought to the kind of car insurance coverage you need. With different kinds of vehicles, drivers, and lifestyles, car insurance is never one-size-fits-all. While most people are familiar with the basics, there are still some types of auto insurance that are a little different, like comprehensive coverage.
Not sure what it is or whether you need it? Stick around, and we’ll break it all down for you.
What is comprehensive insurance?
Essentially, comprehensive insurance is a type of optional coverage that protects your car from damages or loss caused by incidents other than collision. Comprehensive coverage can be added to your car insurance policy to protect your vehicle from things that are typically out of your control. On the flip side, collision insurance is exactly what it sounds like: coverage for damages caused by a collision with another car or object. Remember, comprehensive coverage is an add-on to your mandatory car insurance coverage.
What does comprehensive insurance cover?
Unexpected incidents happen. Expanding on what we touched on above, comprehensive coverage protects your car from things that are typically out of your control.
This means things like:
- Theft or attempted theft
- Damage caused by flying or falling objects
- Fire, explosions
- Collisions with animals
- Weather-related damage from windstorms, tornados or earthquakes.
Make sure you review your insurance company’s policy details to understand the specific coverage and any exclusions.
What isn’t covered by comprehensive insurance?
As we already know, comprehensive insurance doesn’t cover damages caused by colliding with another car or object (which is covered by collision coverage!).
So, what else doesn’t it cover? Normal wear and tear on your vehicle with things that you typically need to repair or replace over time. This means updating things like tires, brakes and brake pads, windshield wipers, and anything else that needs maintaining or replacing with extended use.
To be 100% sure of what’s covered or not covered under your comprehensive insurance plan, make sure you contact your insurance provider or review your policy.
Do I need comprehensive coverage?
While comprehensive insurance isn’t mandatory coverage for everyone, it is required in some cases, like if your car is leased or financed, or in certain provinces in Canada.
As comprehensive coverage is generally optional for those who own their vehicle outright, it’s worth considering whether it’s really worth it for you in your own unique situation. Do you have enough money at your disposal for unexpected repairs, or to replace your car if it's damaged or stolen? What’s the value of your car based on its age and condition?
Whether it’s required or not, it can be beneficial in many cases as it can protect you if your car gets damaged by unexpected events that are beyond your control, so that you don’t have to worry about paying the entire repair bill. But if you have an older vehicle with some existing damages, it may not necessarily serve you in the same way.
Remember, it’s a good idea to consult with an insurance representative who can help you figure out exactly the coverage you really need!
How much will comprehensive coverage cost?
Let’s talk numbers! When looking into how much this additional auto insurance coverage will cost, it’s important to remember that it will depend on a variety of factors like the province you live in, your current premium, and your deductible amount.
Choosing your deductible amount is entirely up to you and what you’re comfortable with spending in the event of an unexpected incident and having to make a claim. Also keep in mind that a smaller deductible will mean a higher premium, just as a bigger deductible will mean a lower premium.
With all that said, according to the Insurance Bureau of Canada (IBC), the average annual cost of comprehensive insurance in 2020 was $140.16.
How does the claims process work with comprehensive coverage?
Just as you would with other insurance claims, the first thing to do is to contact your insurance company to inform them of the incident. They’ll ask you to provide all necessary information like the date and time of the incident, damage reports, police reports, photos and/or video footage of the damage, and the contact info for all parties involved.
You’ll then be assigned an adjuster who’ll handle your claim, and will need to get estimates for your car repairs. If your claim is approved, your deductible will be subtracted from your claim amount, and you’ll be reimbursed the difference. This amount depends on several factors like your deductible, as mentioned, and the value of your car if it’s a total loss.
Some people will be covered for the current value of their car, while others who opted for extra for replacement cost coverage may be eligible to receive up to the original value of their vehicle. Be sure to look into what applies to you!
How to get comprehensive coverage
Now that you know the ins and outs of comprehensive coverage, you’re better equipped to decide whether it’s something that makes sense for you to add to your auto insurance policy.
Whether you’re setting up a new car insurance policy from scratch, or simply want to add comprehensive coverage, your insurance provider can answer all your questions and get you the coverage you choose!
Frequently asked questions about comprehensive coverage
Comprehensive car insurance is generally not mandatory in Canada, except in Manitoba where it is included in the mandatory plan offered by Manitoba Public Insurance (MPI).
However, if you have a car loan or lease, your lender or leasing company may require you to have comprehensive coverage until the loan is paid off or the lease is terminated.
Comprehensive car insurance coverage helps to protect your vehicle from damage or loss that is not caused by a collision with another vehicle or object. It covers events like theft or attempted theft, vandalism, fire, windstorm, earthquake, flying or falling objects, and damage caused by animals. On the other hand, collision insurance coverage protects you when you’re in a car accident involving other vehicles.
If you already have car insurance, you can typically add comprehensive coverage to your existing policy. Contact your insurance provider and inquire about adding comprehensive coverage. They will guide you through the process and provide details about any adjustments to your premium or deductibles.
Yes, comprehensive car insurance coverage has a deductible. A deductible is the amount you agree to pay out of pocket before your insurance coverage kicks in. For example, if your comprehensive deductible is $500 and you file a claim for $2,000 in damages, you would pay the first $500, and your insurance company would cover the remaining $1,500.