Property and Casualty Insurance Practice Exam

Which type of loss is NOT typically covered by comprehensive auto insurance?

1. Theft or larceny

2. Collisions with another vehicle

3. Fire damage

4. Vandalism or malicious mischief

The correct answer is: Collisions with another vehicle

Comprehensive auto insurance is designed to cover a wide range of non-collision-related losses that can affect a vehicle. These include theft, fire damage, and vandalism, among other risks, which are all included under comprehensive coverage. This type of insurance is particularly useful for protecting against unexpected events that occur outside of typical driving situations. Collision coverage, on the other hand, specifically addresses damages that result from collisions with other vehicles or objects. Therefore, losses stemming from accidents involving other vehicles are not covered by comprehensive insurance but are typically covered by a separate collision policy. This distinction is crucial for understanding how auto insurance policies are structured and the specific types of incidents each type of coverage addresses. Understanding these nuances ensures policyholders select the appropriate coverage for their needs.