What’s the difference between comprehensive coverage and collision coverage?
Comprehensive coverage and collision coverage are the two main coverages that protect against damage to the insured vehicle. Collision usually applies when multiple vehicles collide with one another. Comprehensive usually applies when the insured vehicle is the only vehicle involved, such as hitting animals, theft, vandalism, falling tree branches and fire.
What is gap coverage in auto insurance?
Auto policies commonly offer gap coverage as an optional feature. The coverage typically applies to the difference between what a driver owes and what their vehicle is worth.
Should the insured vehicle be totaled while there’s a loan or lease on it, comprehensive and collision would only pay up to the vehicle’s current value. This is often less than what’s owed because of depreciation, thus creating a gap for which the driver is responsible. Gap coverage typically covers that financial gap so that drivers don’t have to pay the remainder of their loan/lease out of pocket.
Drivers who have leases or loans on their vehicles are often required to carry gap coverage. This protects the lender’s interest in the car, in case drivers can’t personally afford to pay the gap if their vehicle is totaled.
Is Texas a no-fault or at-fault state?
Texas’ auto insurance laws make it an at-fault state, where the driver who causes an accident can be held financially liable for any harm insured. The state’s laws allow drivers to sue responsible parties in most cases (if necessary).