Collision Car Insurance Coverage
Although liability auto insurance is required by law in nearly every state, collision car insurance is not. Despite not being mandatory, collision car insurance coverage is extremely important for many reasons, specifically that it insures the policyholder’s vehicle in case of an accident.
Many people are confused about what collision insurance covers and why it matters. A collision refers to being hit or hitting another vehicle or object and causing damage. Collision car insurance coverage protects against any collision damages incurred, regardless of what or who caused it.
Protect An Investment – Car Insurance
Any damages sustained to the at-fault vehicle in an accident will be the driver’s responsibility to pay for out of their own pocket if they don’t have collision car insurance coverage. If someone is making payments on an auto loan or lease, the lender will normally require collision insurance be purchased and maintained along with regular liability coverage for the duration of the contract.
Collision coverage protects the lender’s investment and lowers a driver’s out-of-pocket expenses by paying for repairs to the vehicle, or even replacement if it has been deemed as totaled.
If you own an older car, it might make sense to decline collision coverage when buying a car insurance policy.
Learn more about Collision vs. Comprehensive Coverage.
Making Collision Coverage Affordable and Cheaper
Collision insurance covers damage from accidents and hitting stationary objects. It won’t cover medical bills, nor will it cover damages to the car by other sources such as theft, vandalism, arson or natural disasters and weather. It is also can be relatively expensive depending on your automobile, with the average national premiums at $301 per year, and thus may not appropriate for every vehicle or driver needing budget car insurance.
However, collision car insurance can be affordable with the right discounts and savings. Many consumers manage the cost of collision car insurance by raising their deductibles to $500 or more. Repairs to older vehicles might only be slightly more than the required deductible, so it is not always cost-effective to maintain this kind of coverage. Buying car insurance with a zero or very low deductible is one way to expect paying high premiums.
On the flip side, paying a $1,500 deductible can be difficult for some families looking for car insurance on a budget. As mentioned before, if you own an old car worth $3,000, and you incur $2,000 in damages, paying $1,500 out of pocket for repairs and expenses might not make sense. It would be best to forget the repairs and look to buy another vehicle.
However, if the retail or cash value of your vehicle is $25,000 and you are in an accident that ends up costing $10,000 in repairs and damages, having collision car insurance coverage and paying the deductible would be a great investment, assuming you have affordable coverage with a good auto insurance company.
Collision Car Insurance Coverage and Determining Fault
There will be times when both parties in an accident disagree about who is at fault and the police officer on the scene or their report won’t make a determination, such as when it occurs on private property. In these cases, it might be better to allow your collision insurance to subrogate the claim: meaning your car insurance company will take over the legal battle/issues and pay for the repairs to your vehicle.
If the insurance company recovers any money from the other party through litigation, they will reimburse the driver for the deductible. Also, if the policyholder has an accident with an uninsured driver, their UM coverage might not be sufficient to cover all the expenses and cost of repairs. Collision insurance steps in to pay the remainder.
Compare Free Car Insurance Quotes
Auto insurance is an extremely competitive industry and the choices between companies and policies can often seem overwhelming. However, to get the best idea of what coverage is available and at what rates, it’s necessary to compare car insurance rates online.
By entering your 5-digit zip code, MyCarInsuranceRates.com offers you the ability to shop and compare car insurance quotes from the best insurance companies in the country, like Nationwide, Allstate, GEICO, Progressive, 21st Century Insurance, Liberty Mutual, State Farm, Farmers, AAA, and AARP, helping find the best, cheap car insurance in the U.S.
Enter your zip code to begin a car insurance quote now to buy the best, affordable collision insurance coverage.
