Physical Damage Coverage to Include in Your Car Insurance

Insuring your car requires considering how you want to address situations where your car sustains damage. Coverage for vehicle damage is one of the prime benefits that an auto policy can offer, but it isn’t automatically included in most plans. Still, even though you have to ask your agent to include these physical damage benefits on your policy, you’ll be glad you did in the end. 

An auto insurance policy’s physical damage coverage can be customized to fit the needs of the individual driver. This will mean paying close attention to the different types of benefits coverage provides, and how you can adjust them to your advantage. 

Below, we’ve outlined how physical damage coverage works on most auto insurance plans, and how each type of coverage can combine to create far-reaching protection for your vehicle at all times. 

Car Insurance for Physical Damage 
There are numerous hazards that might damage your car. These might include: 

• Wrecks and other collisions
• Natural disasters like floods, hail or windstorms
• Vehicle fires
• Vandalism
• Theft
• Falling objects, from trees to items falling off of other vehicles or buildings 

Of course, you usually don’t expect these problems to occur, and there are only limited ways that you can protect your vehicle, no matter how hard you try. Regardless, however, the losses could be very costly, and you will naturally want to have your vehicle repaired or replace it with a new one. With the right car insurance, you’ll be able to do so. 

Most auto insurers offer physical damage insurance. However, they don’t offer it automatically. Most states only require drivers to carry liability insurance, which will only pay for damage done to other people’s property. Therefore, to get physical damage coverage, you will need to ask your agent to add it to your plan. 

Common Types of Physical Damage Insurance 
There are many different types of physical damage coverage that different insurers might offer. Your need for each type of coverage can vary. Basic benefits to consider adding to your plan are: 

• Collision Insurance: This coverage pays for damage to your car following a collision with another vehicle or object. Even if an accident is your fault, you can use this coverage to pay for the necessary repairs.
• Comprehensive Damage Insurance: This coverage pays for damage to your vehicle that is caused by something other than a collision. Usually, it will cover damage from hail, flooding, wind, fires, theft & vandalism, and animal strikes. Despite its name, it does not cover collision damage, too. You must buy both of them to receive both types of benefits.
• Uninsured/Underinsured Motorist Coverage: A wreck might be the other driver’s fault. As a result, their auto liability insurance should be the coverage that pays for your damage. However, if they do not have enough liability insurance, or if they don’t have any at all, then your plan can help you pay for your losses if you have uninsured/underinsured motorist coverage. 

Still, to tailor your physical damage coverage to your advantage, pay attention to the different terms that can influence the amount of compensation that you can receive for a claim. These include: 

• Deductibles: When your car sustains damage, a deductible is an amount of money that you agree to pay towards the cost of repairs. For example, if you have a $1,000 damage deductible, and your car sustains $3,000 in wreck damage, then your plan will only pay up to $2,000. You agreed to cover the remaining $1,000 yourself. Additionally, if your vehicle sustains damage that is less than your deductible value, then your plan will not cover the cost.
• Actual Cash Value Coverage: If your car is beyond repair, then your insurer will provide an amount of money to help you buy a new car. If this settlement is based on the car’s actual cash value, then you will be paid based on the car’s used value at the time of the wreck. This is not the amount you might need to put towards a new car.
• Replacement Cost Value Coverage: If you want to potentially receive a higher settlement for a totaled vehicle, then consider buying a policy that pays based on the car’s replacement cost value. With this coverage, you will receive a settlement based on the like-new value of a similar vehicle. 

Additionally, there are times when you might need specialty physical damage coverage, such as: 

• Gap Insurance: If you total a car that you have financed, then this coverage can help you pay off the difference between the value of the car (paid by your insurer) and the remaining value of the loan.
• Custom Parts Coverage: Standard physical damage coverage will not cover damage to items that you added to the vehicle after you bought it. If you add special features to the car, like custom stereos, chrome plating or rims, then you will need custom parts coverage. 

In most cases, you must buy these specialty benefits either as endorsements to your standard coverage, or as supplementary policies. 

With the help of our agents, you will receive the guidance that you need to determine how best to structure your physical damage benefits to your advantage.