Many people look to save money by choosing third-party vehicle insurance over comprehensive cover. However, this could end up costing them a lot more in the long run, if their vehicle subsequently gets damaged. With the cost of car parts and vehicles increasing every day, the question should become: can you afford not to have comprehensive insurance?
What is comprehensive insurance and how is it different from third-party Insurance?
Third-party liability insurance is typically the bare minimum cover that a driver is required to have by law. It provides cover for your legal liabilities to third parties for any injuries or damage that you cause. It does not provide cover for your injuries or damages to your vehicle.
In addition to above, comprehensive vehicle insurance also provides cover for damage to your vehicle (including its windscreen), due to vandalism, theft, hurricane, fire, flood, windstorm and other causes. There is also some limited cover for your medical expenses, even if you are at fault for an accident. The higher cost of comprehensive cover reflects the much wider protection it provides.
Other reasons to buy comprehensive insurance
Did you know that you may have to pick up the costs to repair your vehicle, even if you are not at fault for an accident? That’s right, if the third-party driver is uninsured or if they race away from the scene without leaving their details, you will be left with the bill – unless you have comprehensive cover.
Leaving your vehicle in a public parking lot is also risky. Think about runaway shopping carts, doors opened too quickly in tight spaces and distracted drivers backing into your vehicle.
Vandals can cause extensive damage by scratching your car and often, the cost to repair a vehicle after a theft is way higher than the value of the items stolen.
Having comprehensive coverage gives you peace of mind that when the unexpected happens, you won’t have to pay the price.
So how much is comprehensive insurance?
On average, comprehensive insurance is $100/month more than third-party insurance. But consider the amount made for the average damage claim: for bodily injury it’s $16,260, for property damage it’s $3,729, and for collision damage it’s $3,278 according to bankrate.com. That $100 extra cost per month for comprehensive insurance suddenly seems great value when you consider how much out of pocket you will be if you have to pick up these costs yourself.
If you simply don’t have the money in your budget for complete comprehensive coverage, there are other insurance options you can consider that provide added protection. For instance, you can choose third-party fire and theft insurance. This gives you the benefit of basic third-party coverage plus added protection for fire and theft, while costing less than full comprehensive coverage.
Key takeaway
For a comparatively small amount of money per month, you can ensure that your vehicle is protected against a wide range of damage that would likely cost you thousands of dollars to fix. With this in mind, true savings are more likely to come from having comprehensive cover when the truly big bills come your way.
