California Personal Injury and Insurance Blog

Collision, Comprehensive and Claims - Oh My

I know I have written about this before, but it comes up fairly frequently in my practice. What is comprehensive? What is collision? Can my rates go up for filing one of these claims? So, lets start with the basics.

Collision coverage applies, if you have it, when your vehicle strikes something else and you are making a claim for damage to your car. So, your vehicle is stopped and hit by another vehicle - collision claim. Your vehicle is being parked in the garage and hits the front of the garage - collision claim. Your vehicle rolls down a hill and into a building - collision claim.

Comprehensive, sometimes called other than collision, applies, if you have it, for anything that is not a collision for damage to your car. Fire? Theft? Vandalism? All comprehensive claims.

Now, lets make it fun. Your car hits a deer. Comprehensive or collision? Clearly, this is collision since the car struck the deer, right? Well, it makes sense, but any time a vehicle and an animal collide, its a comprehensive claim. It doesnt make sense, but go with it if you strike an animal.

Why does it matter? For a few reasons. First, some people carry collision but not comprehensive or vice versa. Second, your rates can go up for an at fault collision. In California, at fault means 51% or more at fault. For a comprehensive claim, your rates cannot go up.

So, you are driving to Santa Barbara and a deer is standing in the road. You hit the deer. The accident is your fault. But, because it is an animal, it is a comprehensive claim and your rates cannot go up. That is why all of this matters! 

Insurable Interest

I was driving the other day with the radio on and an ad came on for an insurance broker. The broker, who shall remain nameless, insures hard to insure drivers. You know, tickets, DUIs, accidents, young drivers, etc.... The ad went like this: "We can insure anybody. Tickets? No problem. DUIs? No problem. Accidents? No problem. The car is not in your name? No problem."

Um, problem. There is this little concept of insurable interest. What is insurable interest? Insurable interest means that you have an interest in what you are insuring. Insurance is not gambling. Okay, this is a complicated concept. So, a few examples.

Lets say I know a 16 year old who just got her driver's license. And, she is a bit accident prone. You know the type - she walks into walls or falls down while walking. Now, I know she is going to get in an accident. Its just bound to happen. According to this broker, I could take out insurance on her car. When she gets in an accident, I would collect on the insurance on the policy I took out on her car. That is called gambling - not insurance.

The basic rule is simple: you cannot insure a car if you do not own it. If you don't own a car, you can take out a driver's policy that will cover you if you drive someone else's car.

Your Insurance Review

Have you had your insurance review this year yet? What review, you ask? Good question.

Your auto and homeowners insurance needs may change every year. For example, you may need to increase your insurance coverages. Or, maybe your old car is a year older and it no longer makes sense to carry collision coverage on it. Maybe you paid off a car and you can increase your comprehensive and collision deductibles from $250 to $500 or $1,000. It may save you some money, or you may want to use those premium dollars to increase your liability coverage, get an umbrella policy, or make some other change to your policy.

The summer is a great time to have your insurance review done. Things are usually slower, not just for you, but for your insurance agent.

Before you have your review, make sure to email me for my book, Consumer's Guide to Buying Car Insurance.