You may be asking yourself how comprehensive and collision deductibles work. To start off, a quick refresher on the difference between collision auto coverage and comprehensive auto coverage. Collision covers damage to your vehicle after an accident. Comprehensive covers damage to your vehicle after something other than a car accident (like if a kangaroo jumped on your car). Comprehensive would also cover damage when your vehicle is stolen.
A deductible is the amount you pay out of pocket. For instance, if you have a $100 deductible and your car incurs $1,000 worth of damage, you’d pay $100 to have it fixed and the insurance would cover the remaining $900.
When it comes to your insurance deductibles for comprehensive and collision coverage, this is important: you don’t choose a cash limit, like you do for some other types of insurance. You get reimbursed for the current value of your car. Yes, the current value of your car and not what you paid for your car. As we all know, the value of the car decreases significantly the moment you drive it off the lot.
If you are driving a hunk of junk and aren’t concerned about replacing the value of your car when an accident or other peril occurs, you probably don’t need to invest in comprehensive or collision insurance. If you would like to recoup the value of a stolen or injured car, you should definitely be thinking about these two types of auto insurance.
It’s not required by law in California, but, sometimes financing institutions require it.
Ready to request an auto insurance quote? Give me a call 858-216-4144 or email me at freddie@torinsurance.com and I will walk you through each step along the road.
This is the blog of Freddie Servin 