Physical Damage Coverage
Physical Damage coverage, though not required by the state, is usually required by the lending institute if your vehicle is financed. The purpose of this is to "Protect" their interest should a loss occur. However, having a loan on a vehicle is not the only reason you should carry Physical Damage coverage on your vehicle. You should weigh the value or replacement cost of your vehicle versus the premium charged and deductible amount for the Physical Damage portion of your policy.
Physical Damage coverage consist of two separate types of coverage. One is "Comprehensive" and the other "Collision" with each having a chosen "Deductible" amount. By definition, the deductible is the amount you are willing to "Insure Yourself" for or the amount you pay should a loss occur. Therefore, the lower the deductible the higher the premium and the higher the deductible the lower the premium. Most companies offer a range from $0. (zero) to $1500.00.
Before selecting a "High" deductible in order to lower your premium cost, you should carefully evaluate your financial resources to ensure your ability to cover a loss. It is for this very reason that some lending institutes, especially Credit Unions, will at times require that you carry a lower deductible.
COMPREHENSIVE COVERAGE:
Covers: Fire, Theft, Glass and Vandalism.
COLLISION COVERAGE:
Covers: Damages resulting from a collision with another vehicle or object.
