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Nov 6 2017

What Is Comprehensive Insurance? #credit #bank

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Types

There are many types of comprehensive insurance. These include commercial insurance, worker’s compensation insurance and personal insurance. However, comprehensive insurance for vehicles is the most common type. Most drivers with automobile insurance have comprehensive coverage. It is so common that the term “comprehensive insurance” is assumed to refer to comprehensive automobile insurance unless otherwise stated.

Function

All comprehensive insurance policies have a coverage amount. This is the maximum the insurance company will pay to compensate the insured for a claim. This can be any amount. The higher the coverage the higher the comprehensive insurance premiums. With automobile comprehensive insurance, the standard coverage amount is usually $100,000. Customers can ask to raise or lower that coverage amount. Comprehensive insurance coverage is sometimes listed under “property damage” on automobile insurance policies. This is because the comprehensive insurance limit also applies to the collision coverage limit.

Considerations

Comprehensive insurance policies usually have deductibles. This is the amount the insured party must pay to settle a claim before the insurance companies contributes money. This prevents a comprehensive insurance policy from being used for small damages. With automobile comprehensive insurance policies, a $500 deductible is standard. Customers can ask to raise or lower the deductible amount. The higher the deductible, the lower the comprehensive insurance premiums.

Effects

Comprehensive insurance policies pay for damages that result from things that are not your fault. They protect you from theft, fire, vandalism and most natural disasters. Automobile comprehensive insurance policies cover most things that could happen to your vehicle when you are not driving it. If something happens as a result of your negligence or your actions, other types of insurance like liability and collision are needed for coverage.

Considerations

Insurance companies often exclude specific causes from comprehensive insurance policies. These can include things like flood, earthquake or mold. Always check the fine print of a comprehensive insurance policy so you know what is covered and what is not. If you are in danger of damage from an excluded cause, additional coverage can be purchased that provides insurance coverage for the specific danger.





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