Flood damage has affected almost all the states of the U.S during the past decade, and when it comes to insurance, many people do not know that “Flood Insurance is the part of comprehensive coverage, and not a part of auto insurance policy”.
And that’s where people run into trouble. Basically, comprehensive insurance ensures that the insurance company will pay for the damages to your car other than accidents. So, you must consult the insurance company regarding comprehensive coverage for your car in case of a flood. The best part? It also includes compensation for the stolen car or the car that gets totally lost in the flood.
According to Statista, an annual flood causes more than 4 billion U.S. dollars worth of property damage alone in the US. The worst part is 20% of claims are from the people who live far away from the high-risk flood zones. Before the catastrophic flood destroys your vehicle, it is important to figure out whether you have flood insurance or not.
Why You Should Protect Your Car With Comprehensive Coverage?
Comprehensive coverage for your car in case of a flood is something that will ensure the safety and complete recovery of the loss if you have lost your car in a flood, especially if you live in Texas, Louisiana, West Virginia, South Carolina, and Missouri.
There are various ways in which your vehicle can be damaged during a flood.
- Complete or partial damage to your car if a tree falls on it.
- If your car is sunk in the flood, and gone for an impromptu swim.
- Someone has stolen your car at the time of disaster.
And any other reason except accidents. Keep in mind that you cannot automatically get qualified for the comprehensive coverage, rather it is an election. The good news is that it not only covers floods but also all the natural calamities and disasters (such as hails, fires, earthquakes, etc) that may cause damage to your vehicle.
If your vehicle is acting as collateral, then you need comprehensive coverage even more badly, otherwise, it can affect your financial budget. In this case, do not forget to carry both collateral and comprehensive coverage. Comprehensive insurance is part of premium insurance so some people do not consider this option. However, it can save you from the biggest problem especially if you are living in a high-risk flood area or any other place prone to accidents, and cannot afford the car damages.
Also read: A Complete Guide on What Does Car Insurance Covers?
Another thing that keeps people away from buying car insurance is that most insurance companies have strict rules and regulations regarding premium insurance. But if the hurricane is being headed, you can be at a great loss if you have not opted for the comprehensive insurance.
What Is Deductible On Car Insurance?
One of the most important restrictions of the insurance companies regarding comprehensive insurance is that you have to pay some specific amount at the time your car gets damaged. This pre-decided amount is called deductible and necessary to get any vehicle insurance benefits.
Also read: Does Car Insurance Cover Natural Disasters?
But there is another side of the story as well. The higher your cost of insurance, the lower your deductible is, and vice versa. So if you cannot afford high insurance costs or want to reduce your deductible, you have only one safe side. It is better to pay before than later. But it is entirely dependent on your own choice and affordability. Once you pay the insurance costs, you can see the deductible amounts as low as $100. Still, confused? Ask your insurance agent to guide you more about the latest rules and regulations.
What Are The Necessary Steps That You Should Take After the Flood Damage To Your Vehicle?
You may want to know: What should I do when my car gets damaged after the flood? The first thing is to contact the insurance agent, or visit the nearby office of the insurance company, and ask for recommendations about the car.
During this step, the experts will closely observe whether the damage to your car is reversible or not. If you are lucky enough and your car can be towed to a repair shop, they will guide you through their insurance company’s preferred repairing shop. Here it is important to discuss that flood-damaged cars are not often able to be repaired properly and there are strong chances that it will get even more damaged or impaired in the future. For example, Flood damage may cause:
- Airbag failure
- Engine Seizure
- Transmission failure
- Computer malfunctions
And many others. You can observe that some of these technical issues are entirely irreversible.
So, the insurance agents will never leave you alone and their preferred shop will remain there for you whenever you will need their help. In most cases, full future handling of your flood-damaged car is also guaranteed.
But we advise you to make everything clear before you proceed with the agent to prevent future problems. You can also hire your own repair guy to verify whether your car can work properly in the future or not.
Should You Take Comprehensive Coverage For Your Older Car?
If you have only one vehicle and it is also acting as collateral for your loan, you will need to opt for comprehensive insurance for your older car as well.
This brings up the question:
Can I drop out of comprehensive coverage after full payment of my loan?
The answer is YES. So it is not a bad idea to go through the comprehensive coverage option and make an informed decision based on your needs to avoid possible future issues.
But if you think your car is of no more value, you can leave the option of comprehensive coverage and do not need to spend on the insurance costs.
What If The Car Is Total Loss?
If your insurance company and the repair agents have clearly stated that the damage is irreversible, you have lost your car, simply pay your comprehensive deductible, and the process is complete.
Also read: Do I still need insurance for a car that doesn’t run?
Within a day or two, the insurance agent will reimburse you for your vehicle’s cash value.
A Quick Tip: If your car damages severely and you are opting for the reimbursement of the cash, start the claim process immediately without any delays.
Reach Your True Potential & Live Without Risks!
After the flood damages your car, you may feel alone and financially frustrated. At this stage, your comprehensive insurance will never leave you alone, and this is perhaps the biggest reason why you must look for comprehensive coverage for your car in case of a flood.