Collision & Comprehensive Coverage: What You Need to Know

Understanding Physical Damage Coverage: Comprehensive & Collision

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What is Auto Insurance Physical Damage Coverage?

Auto insurance physical damage coverage refers to the portion of your car insurance policy that covers damage to your own vehicle. It is optional coverage that protects you financially if your car is damaged in a collision, by a non-collision event like theft or hail, or in some other way.

Gary Paulson, owner of Mid-Columbia Insurance in Washington state, explains: “Physical damage coverage gives you peace of mind knowing you can get your car repaired or replaced after an accident or other covered loss, without paying out of pocket beyond your deductible.”

There are two main types of physical damage protection:

  1. Collision coverage: Pays for damage to your car from impact with another vehicle or object, regardless of fault.
  2. Comprehensive coverage (also known as “Other Than Collision”): Covers damage from events like theft, vandalism, fire, glass breakage, hitting an animal, and weather-related incidents.

While not required by Washington law, collision and comprehensive are valuable optional coverages that provide extensive protection for damage to your own vehicle. If you have a loan or lease, your liender will likely require both.

How Does Physical Damage Insurance Work?

When you purchase auto physical damage insurance, you choose a deductible amount for each coverage, typically $500 or $1000. If your car is damaged in a covered incident, you are responsible for paying the deductible, and your insurer pays the rest of the repair or replacement costs, up to the policy’s limits.

The claims process typically involves:

  1. Reporting the loss to your insurance company
  2. Getting a damage assessment and repair estimate from a mechanic
  3. Determining fault (for collision claims)
  4. Settling the claim, which may involve:
    • The insurer paying the repair shop directly
    • The insurer cutting you a check for the repairs or for the car’s actual cash value if it’s totaled
    • Subrogation (the insurer seeking reimbursement from an at-fault party’s insurer)

Collision and comprehensive pay for damage regardless of fault, which means you can file a claim with your own insurer for a quick settlement. Your insurer will then seek reimbursement through subrogation if another party is at fault.

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What Affects the Cost of Physical Damage Coverage?

Several factors influence physical damage insurance premiums, including:

  • Deductible amount: Higher deductibles mean lower premiums, but more out-of-pocket costs after a claim.
  • Vehicle type and value: Expensive, high-performance, and commonly-stolen vehicles cost more to insure.
  • Driver characteristics: Your age, driving record, and claims history can affect your risk profile and rates.
  • Garaging location: Urban areas with higher rates of accidents and auto theft tend to have higher premiums.
  • Coverage limits: Policies with higher limits cost more.
  • Discounts: You may be eligible for discounts based on your car’s safety features, your driving habits, and insuring multiple vehicles.

Your Mid-Columbia Insurance agent can help you compare physical damage coverage options and costs to find the best fit for your needs and budget. We work with multiple insurers to find you the most comprehensive auto protection at competitive rates.

Is Physical Damage Coverage Required in Washington?

Washington state law does not require physical damage coverage for your own vehicle. The mandatory minimum car insurance only includes liability to pay for others’ injuries and property damage if you cause an accident.

However, if you lease or finance your vehicle, your lessor or lender will almost certainly require you to carry both collision and comprehensive until the car is paid off. They want to protect their financial stake in the vehicle.

Even if you own your vehicle outright, physical damage protection is a smart investment if you couldn’t afford to repair or replace your car after an accident. Collisions, theft, and weather damage happen every day. Collision and comprehensive pay to fix your car so you can keep driving after an unexpected event.

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What Vehicles are Covered by Physical Damage Insurance?

Auto physical damage coverage applies to the vehicle(s) named in your policy declarations. It can include:

  • Private passenger cars (sedans, hatchbacks, coupes, convertibles, etc.)
  • Minivans and SUVs
  • Pickup trucks
  • Some types of trailers
  • Classic and collector vehicles (may need specialized coverage)

Comprehensive extends to losses that occur while the vehicle is parked. Collision only applies to vehicles in operation.

Leased and financed vehicles must usually carry both collision and comprehensive. The coverages are often optional for owned vehicles.

Your physical damage insurance can sometimes extend to rental cars. Talk to your insurance agent to make sure you’re properly covered before renting.

What Perils are Covered by Physical Damage Coverage?

Collision insurance covers damage to your vehicle from:

  • Impact with another vehicle, such as if you rear-end someone or get T-boned at an intersection.
  • Hitting a stationary object like a tree, pole, or guardrail. For example, if you skid on ice and crash into a telephone pole.
  • A rollover accident, where your vehicle flips onto its side or roof, often due to taking a turn too fast or swerving to avoid an obstacle.

Comprehensive insurance covers damage from non-collision events, including:

  • Theft and vandalism. Comprehensive will pay if your car is stolen and not recovered, or if it is damaged by thieves or vandals.
  • Fire and explosions, such as if your car catches fire due to an electrical problem or is damaged by a nearby explosion.
  • Natural disasters like hurricanes, tornadoes, earthquakes, and floods. For instance, comprehensive would cover flood damage if a hurricane storm surge submerges your vehicle.
  • Falling objects, like if a tree limb falls on your car during a windstorm, or an object falls off an overpass onto your vehicle.
  • Animal strikes, such as if you hit a deer that darts into the road. 
  • Glass breakage, like if a rock kicked up by a truck cracks your windshield, or your sunroof is shattered by hail. Some policies offer separate no-deductible glass coverage.
  • Missiles or projectiles, such as debris falling from vehicles including usecured cargo. By definition it covers while these objects are airborn and moving. Once they become stationary, hitting them falls under collision coverage.

Notable perils excluded from both collision and comprehensive include:

  • Damage to another person’s vehicle or property (liability). For example, if you cause an accident that damages someone else’s car or a fence, your liability coverage would pay for that, not your physical damage coverage.
  • Wear and tear, such as worn brake pads or tires that need replacing due to normal use, not an accident.
  • Mechanical breakdown, like if your transmission fails or your engine seizes up, unless it is a direct result of a covered incident like a collision or flood.

Your insurance agent can review covered and excluded perils with you in more detail.

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How Does Physical Damage Claims Settlement Work?

If your vehicle is damaged in a covered incident, your physical damage insurance will pay for repairs, minus your deductible amount. The settlement process involves:

  1. Getting a repair estimate from a mechanic or body shop
  2. Having the shop complete the repairs
  3. Paying your deductible to the shop
  4. Having the insurer pay the shop the balance owed

For example, say your car is rear-ended and needs $2500 in repairs. If you have a $500 collision deductible, you pay $500 to the shop and your insurer pays the remaining $2000.

If the damage to your vehicle exceeds a certain percentage of its value (usually 60-80%), the insurer will declare it a total loss. You will receive a payment for the actual cash value (ACV) of the car, minus your deductible. ACV equals the pre-loss market value, with a deduction for depreciation based on age and mileage.

If you have a new car, some insurers offer extra replacement cost coverage that will pay for a new vehicle if yours is totaled, without a deduction for depreciation. Your agent can advise if this is available and cost-effective for you.

If you disagree with the insurer’s damage assessment or settlement offer, most policies have an appraisal clause where you can get an independent evaluation to determine the amount owed.

Do I Need Physical Damage Coverage?

Whether you need physical damage coverage or not depends on if you have the vehicle financed, the value of your vehicle, your savings, and your comfort with financial risk. Ask yourself:

  • How much could I afford to pay out of pocket to repair or replace my vehicle if it were totaled tomorrow?
  • Do I have enough in savings to buy a replacement vehicle?
  • Is my vehicle leased or financed, requiring collision and comprehensive?

If you don’t have enough savings to replace your vehicle, or couldn’t afford major repairs, physical damage insurance is a wise investment. Your independent Mid-Columbia agent can help you compare coverage from different insurers.

When selecting deductibles and policy limits, consider:

  • Higher deductibles mean lower premiums, but require more out-of-pocket payment after a claim. Choose an amount you could comfortably pay on short notice.
  • If a $1000 deductible only saves you $10 per month over a $500 deductible, you would need to go 4 years without a claim to break even. If it saves you $25 a month, the higher deductible makes more sense since it would take less than 2 years.

If your car is older and not worth much more than your deductible amount, comprehensive and collision may not be cost-effective. Discuss your vehicle’s value and coverage options with your agent.

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What Additional Physical Damage Coverages are Available?

In addition to basic collision and comprehensive, many insurers offer supplemental physical damage coverages for more protection, including:

  • Rental car reimbursement: Pays for a rental car while yours is being repaired after a covered loss. Daily and per incident limits apply.
  • Loan/lease gap coverage: If your financed or leased vehicle is totaled, this pays the difference between the insurance settlement and the balance on your loan or lease.
  • Replacement cost coverage for new vehicles: Pays to replace your totaled car with a new one of the same make and model, without a deduction for depreciation. Time and mileage limits apply.
  • Roadside assistance: Covers towing and labor costs if your vehicle breaks down. Can include lockout service, fuel delivery, and spare tire changes.
  • Custom parts and equipment: Extends collision and comprehensive to cover high-value aftermarket additions like audio systems, navigation devices, custom wheels, and performance add-ons.

Ask your insurance professional which optional coverages might be right for you.

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– Your Trusted Auto Insurance Agent

Collision and comprehensive insurance are the best way to guard your finances against unexpected damage to your vehicle. Liability coverage won’t pay to repair your own car after an at-fault accident, a theft, a hailstorm, or a deer strike – but physical damage coverage will.

Contact Mid-Columbia Insurance today to discuss your auto insurance needs. We’ll compare rates and coverages from multiple insurers to craft a comprehensive physical damage policy that fits your needs and budget. Don’t wait until after an accident to discover your coverage gaps.

Call us for a free quote and expert guidance to keep you cruising down the road with confidence. Request an auto quote from one of our independent insurance agent professionals today by calling (509)783-5600 or click “Get a Quote”.

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Physical Damage Coverage

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Frequently Asked Questions

Question Answer
What is the difference between physical damage insurance and liability insurance? Physical damage insurance covers damage to your own vehicle, while liability insurance covers damage you cause to other people’s property or injuries you cause to others in an accident.
Does physical damage insurance cover mechanical breakdowns or normal wear and tear? No, physical damage insurance typically does not cover mechanical failures or normal wear and tear. It is designed to cover sudden and accidental damage to your vehicle, such as from a collision or natural disaster.
Are there any optional coverages I can add to my physical damage insurance? Yes, many insurers offer optional endorsements for physical damage insurance, such as rental car reimbursement, custom parts and equipment coverage, and zero-deductible glass coverage. These can provide additional protection and benefits beyond the standard coverage.
What happens if my car is totaled in an accident? If your vehicle is declared a total loss, your physical damage insurance will pay you the actual cash value (ACV) of your car, minus your deductible. ACV is the value of your car just before the accident, taking into account factors like age, mileage, and condition.
How do I file a claim for physical damage insurance? To file a claim, contact your insurance company as soon as possible after the damage occurs. Provide them with details about the incident, including the date, location, and circumstances. Your insurer will guide you through the process, which may include providing documentation, obtaining repair estimates, and paying your deductible.
Can I choose my own repair shop for physical damage insurance claims? In most cases, yes. You have the right to choose your own repair shop for physical damage insurance claims. However, your insurer may recommend or incentivize using a preferred provider or direct repair program (DRP) shop, which can streamline the process and guarantee the quality of repairs.
How do insurers determine the premium for physical damage insurance? Insurers consider various factors when determining your physical damage insurance premium, such as your vehicle’s make, model, and age; your driving record and claims history; your location and parking situation; and your chosen coverage limits and deductibles. Some insurers also consider your credit score or use telematics to assess your driving habits.
Is physical damage insurance required by law? While most states require liability insurance, physical damage insurance is optional. However, if you have a loan or lease on your vehicle, your lender or lessor will likely require you to carry both collision and comprehensive coverage until the vehicle is paid off.
What should I consider when choosing a deductible for physical damage insurance? When choosing a deductible, consider your financial situation and risk tolerance. Higher deductibles generally result in lower monthly premiums but higher out-of-pocket costs if you need to file a claim. Lower deductibles mean higher premiums but less expense if you have a claim. Strike a balance between affordable premiums and manageable potential claim costs.

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