Car Insurance 101: Comprehensive vs Collision

Car insurance can be of numerous types. Selecting the right car insurance can be quite tricky, especially if you do not know what it covers.

Car insurance usually is inclusive of legal liability and damage to the vehicle that arises out of an accident. However, additional car insurance like comprehensive or collision car insurance are common add-ons that can ensure additional safety of your vehicle.

To select the right car insurance, you need to get a hold of an assured insurance advisor like Surex. Click to find out more about car insurance in Calgary.

You need an insurance advisor to help you get the cheapest and most affordable car insurance quotes in your locality. Knowing the differences between comprehensive vs collision insurance will help you understand which one to go for.

Going for the wrong car insurance will not only mean you overpay but also make things quite stressful.

Continue reading to learn more about the differences between comprehensive vs collision insurance in Canada.

The types of car insurance in Canada

There are usually several types of car insurance that drivers can purchase in Canada:

  • Comprehensive coverage
  • Collision coverage
  • Third-party liability coverage
  • Depreciation coverage
  • Windshield coverage
  • Accident forgiveness
  • Family protection

You, obviously, do not need all of them. Every individual’s needs will vary according to various factors such as car model, area of residence, etc. In this article, we will deal with comprehensive vs collision insurance to help you determine if you need one.

What is comprehensive car insurance and why is it important in Canada?

When looking at comprehensive vs collision coverage, it is important to know that comprehensive car insurance is optional, which means that it is added to a pre-existing car insurance policy for an additional fee.

Comprehensive car insurance helps protect your vehicles against non-collision-related events usually occurring off the road. Usually, comprehensive car insurance coverage depends on the car insurance provider that you select.

What does comprehensive car insurance cover?

There are many risks when it comes to vehicles, both on and off the road. While collision or accidents are the most probable risk when it comes to an operating vehicle, there are additional risks that do not come from accidents. Such risks are covered under comprehensive car insurance, which includes:

  • Risk of vandalism by other people
  • The risk of theft and attempted theft which is extremely common.
  • Risk of damage due to fallen objects like trees, tree branches, parts of a building, etc.
  • Risk of windstorms that cause damage
  • The risk of fire damage
  • Risk of hailstorm damage
  • Other forms of risks that might crack the windshield and cause other damages.

The Specified Perils portion of the auto insurance policy mentions the risks that are covered in your insurance policy. It is important to check whether your existing car insurance already covers the risks mentioned above. Thus, you wouldn’t need additional comprehensive car insurance.

Characteristics of comprehensive car insurance in Canada

Comprehensive car insurance payment differs from company to company. Every company has its own process of determining the insurance premium rates and is affected by the size of the deductible. Thus, increasing your deductible will help you get better rates. The best way, however, is to consult your insurance broker to get a better deal on comprehensive car insurance.

Comprehensive car insurance is not mandatory for drivers in Canada and is purely optional. However, this can increase insurance rates, making car insurance much more expensive.

Owners of old and low-valued vehicles might not find comprehensive car insurance a viable option for their vehicles. Moreover, many companies offer comprehensive car insurance only to owners of new or comparatively new vehicles and do not offer it for cars older than 15 years.

What is collision car insurance and why is it important in Canada?

Collision car insurance is another form of optional car insurance that protects your vehicle in the case of damage resulting from a collision with another vehicle or object.

Sometimes, a collision with another car or objects like trees, guardrails, etc., might cause damage to your vehicle. To avoid such risks, you might consider getting collision car insurance. Moreover, collision car insurance will not cover any mechanical failure or wear and tear of your vehicle but only the damage from potholes or collisions from rolling your vehicle.

Collision car insurance provides extra protection and is cost-effective when leasing or financing your car or driving a high-value vehicle. However, if your car has depreciated significantly, collision car insurance can get a bit heavy on the pocket or might even lead to a loss.

To understand whether you need collision car insurance, you must know your car’s actual cash value. Thus, depending on the value of your car, you can decide whether to enter into collision car insurance or skip it altogether.

Collision car insurance coverage in Canada

When talking about insurance for collision vs comprehensive coverage, remember that collision car insurance only covers the repairing or replacement costs that arise due to any damage caused due to collision. Thus, if your vehicle faces a collision with another vehicle or object, the car insurance company will provide repair and replacement costs.

The coverage is, however, not dependent on whose fault the accident is. Liability coverage is not included in collision car insurance, meaning that costs for damage to another person’s car from the accident are not covered.

Collision car insurance, like comprehensive car insurance, is not mandatory for drivers in Canada and is only an add-on to regular car insurance. It is essential to assess the car’s value and then make an informed decision.

Collision vs comprehensive coverage: Which one should you choose? — Conclusion

To summarize, whereas comprehensive car insurance includes risks to cars that come from vandalism, weather forces, theft, etc., collision car insurance covers risks of collision due to other vehicles and objects. As mentioned, both collision vs comprehensive insurance are not mandatory but can be entered into to get additional risk coverage, which is usually not covered by regular car insurance.

The best way to find out that will be by contacting an online insurance brokerage who will guide you along the right path.

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