What is comprehensive insurance?
Comprehensive means the widest cover a policy offers, including your own losses, not just damage you cause to others.
"Comprehensive" is the widest level of cover a policy class offers. It is most often used about motor insurance, but the idea applies across cover types.
Comprehensive vs third-party
- Third-party (the legal minimum for a vehicle) pays for damage or injury you cause to other people. It does nothing for your own car.
- Comprehensive covers third-party liability and your own loss, accident damage, fire, and theft of the insured item itself.
So if your car is stolen or written off in an accident that was your fault, only comprehensive cover pays to replace it.
What "comprehensive" does not mean
Comprehensive is not unlimited. Every policy has:
- Exclusions (things it never covers, listed in the wording)
- An excess (the first part of any claim you pay yourself)
- A sum insured (the most it will pay, based on the value you declared)
The underinsurance trap
If you insure a 10 million naira asset for 6 million to save on premium, the "average" clause means a claim is scaled down in the same proportion, so a 3 million naira loss pays 1.8 million. Comprehensive cover only works fully when the sum insured matches the real replacement value. That is why logging accurate values in your vault matters.
