Let’s talk about Comprehensive Coverage vs. Specified Causes of Loss.Most would believe that comprehensive coverage is the only option available when purchasing insurancefor your owned autos.But there are always ‘other’ options to help you save money on premiums and find the most appropriate policy coverage for your business needs.
Specified causes of loss offer less coverage than comprehensive coverage.In other words, the policy will specify what is covered, as opposed to 'any thing other than collision'. For that reason, specified causes of loss and comprehensive coverages cannot co-exist on the same policy because of duplicate coverage.
Comprehensive Coverage is one of two types of physical damage usually provided by the policy for owned autos. Comprehensive covers any and all perils that might damage the automobile except collision, overturn, and certain excluded perils. The coverage is all risk and will even cover damage caused in very unusual situations, such as, when an oil well spews acid that eats away the paint, a dog gets upset and rips the upholstery, or a sandstorm sandblasts the windows.
Specified causes of loss (formerly called fire, theft, and combined additional coverage) is a substantially less expensive alternative approach to purchasing comprehensive coverage. It is known as named perils coverage, which provides protection against specified perils such as the following.
- Fire
- Theft
- Windstorm
- Earthquake
- Hail
- Lightning
- Explosion
- Flood
- Vandalism
- Sinking, burning, collision, or derailment of a conveyance transporting the covered auto
Exposures not covered are very unusual, seldom occurring events such as those mentioned earlier. In addition, damage to windshields from flying rocks, often encountered on roadways, would be excluded. If there is low exposure to these perils or if your company can afford to retain some of the exposure, such as windshield damage, you should use this approach. In most cases, choosing the alternative specified causes of loss coverage will result in reduced premium dollars.
