Does Car Insurance Cover Repairs?
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Ann Herro has been writing about insurance and employee benefits for over 15 years. She covers topics ranging from car insurance to healthcare costs.
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When Does My Car Insurance Cover Repairs?
How Does My Insurance Cover Repairs?
How Much of My Repairs Are Covered by My Car Insurance?
If Basic Car Insurance Doesn't Cover Repairs, What Will?
When Does My Car Insurance Cover Repairs?
Whether or not your car insurance covers repairs depends on the cause of the damage.
Car insurance does not cover repairs for general wear and tear on your vehicle, such as your brakes needing to be replaced. In order for insurance of some kind to cover repairs to your vehicle, it'll have to be damaged in an accident or by something out of your control, like vandalism or hail.
If you're in an accident caused by another driver, your car repairs will be covered by the at-fault driver's liability insurance (assuming they have it). Likewise, your liability insurance covers repairs for damage to other people's vehicles if you cause an accident.
What happens if you cause an accident and damage your own car or if your car is damaged by hail, a falling tree, or vandalism? You'll need to have two types of coverage included in your policy if you want your car insurance to cover the repairs. These are optional, so you'll need to check your policy to see if you have them.
- Collision coverage: Covers your vehicle should it collide with another vehicle or an object, such as a tree.
- Comprehensive coverage: Covers damage to your vehicle that is the result of anything other than a collision, such as hail, vandalism, or a tree falling on your car.
If the damage to your car is not a result of general wear and tear and falls under your collision or comprehensive coverage, then repairs are covered.
How Does My Insurance Cover Repairs?
Let's say your car was outside in a rainstorm that resulted in hail damage. In this case, if you have purchased comprehensive coverage, then your car insurance will cover the repairs to your vehicle.
When you call your insurance company to report the damage, they'll open a claim and investigate the cause of the damage. If it falls under your comprehensive coverage, they'll set you up with an approved repair shop, and you'll be able to have your car fixed.
From there, you aren't responsible for much more than waiting to hear that your car has been fixed. Your insurance company will take care of the heavy lifting.
How Much of My Repairs Are Covered by My Car Insurance?
Car insurance pays out for repairs according to the specifics of your policy.
If you have to make a comprehensive or collision claim, you’ll have to pay the deductible that you chose when you purchased your policy. Your repairs will then be covered up to the car’s actual cash value (ACV) amount. The ACV is the fair market value of your vehicle at the moment before the damage occurred.
Let’s say your comprehensive deductible is $500, and your repairs after damage from a severe storm cost $2,500. You’d be responsible for paying the $500 deductible out-of-pocket.
Deductibles are per incident, so each time you make a collision or comprehensive claim, you’ll have to pay your deductible. Remember that choosing a higher deductible can help you save money on your car insurance premium, but it can also make getting repairs difficult if you don’t have the cash when you need it.
If your repair bill is not much higher than your deductible (e.g., a $700 repair bill with a $500 deductible), it might not make sense to file a claim if you can afford to pay the full bill out-of-pocket. If you file a lot of claims or even a single, very expensive claim, your insurance company may raise your rates at renewal time. It always makes sense to weigh all of the financial implications of filing a claim for repairs.
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If Basic Car Insurance Doesn't Cover Repairs, What Will?
If you want to make sure you're covered for certain repairs, talk to your independent insurance agent about purchasing collision and comprehensive coverage. Both of these policies will provide added protection against common scenarios that drivers encounter.
You can also look into purchasing mechanical breakdown insurance (MBI) to cover the cost of repairs for any mechanical issues your car might experience.
Another option is to look into an extended warranty. This is usually offered when you purchase your car and can cover you against unique issues that happen with your car, mechanical or otherwise, within a certain time frame or mileage.