There is a case to be made for getting just comprehensive and not collision insurance, even if your car is not valuable. Comprehensive covers you for a lot more perils than does collision--including, most importantly, against theft. Regardless of the value of your car, having it stolen is a major inconvenience. Even if your car is worth only $2,000 at the time of the theft, and your insurer gives you $1,500, that sum would go a long way in buying yourself a new vehicle. As we discuss in more detail below, comprehensive insurance generally costs no more than $200 per year, so a $1,500 reimbursement would make the coverage valuable.
Definition: Motor third-party insurance or third-party liability cover, which is sometimes also referred to as the 'act only' cover, is a statutory requirement under the Motor Vehicles Act. It is referred to as a 'third-party' cover since the beneficiary of the policy is someone other than the two parties involved in the contract (the car owner and the insurance company). The policy does not provide any benefit to the insured. However, it covers the insured's legal liability for death/disability of third-party loss or damage to the third-party property.
Actual cash value equals the purchase price of your car minus depreciation and your deductible. So comprehensive coverage will pay an amount up to the actual cash value of your car to either repair or (in the case of a total loss) replace it. If the cost of repairs exceeds your car's ACV, your car insurance company will declare it a total loss and pay the sum of the car's ACV to help you replace it — unless you opt to retain salvage (i.e., keep the totaled car), in which case the salvage value will also be deducted from your payout.
Registered Office, Level 28, 266 George St, Brisbane QLD 4000. Information provided is general advice only and has been prepared without taking into account any person's particular objectives, financial situation or needs. Read the relevant Product Disclosure Statement or Policy Document available at www.aami.com.au and consider whether it's appropriate for you before making any decisions about whether to buy or continue to hold a product. Information current as of 9 July 2015.
There are two types of automobile third-party liability coverage. First, bodily injury liability covers costs resulting from injuries to a person. These injuries' costs could include expenses like hospital care, lost wages, and pain and suffering due to the accident. Second, property damage liability covers costs resulting from damages to or loss of property. Examples of property damage include the payment to replace landscaping and mailboxes, as well as compensation for loss of use of a structure.
Our data shows that 7% of Progressive drivers with comprehensive coverage have a comprehensive claim in a given year, and the average repair is about $1,400. Without comprehensive, that's how much you may have to pay out of pocket. Keep in mind, repair costs can vary widely based on your damage and how much your car is worth. Typically more expensive cars cost more to repair.
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