Collision insurance

 Most states only require liability insurance to protect others from any damages you may cause while driving. However, liability minimums are not the only useful coverages. If you finance or lease a car, the lender or dealer will almost certainly require you to have full coverage auto insurance, which includes comprehensive and collision coverage. Most insurance companies provide collision coverage as an optional extra.

While collision insurance raises the cost of your auto insurance, it provides the financial protection that most drivers value: coverage for if your car is damaged in an accident. This way, you pay a deductible rather than covering all expenses out of pocket if your car is damaged as a result of a covered claim. What exactly is collision coverage, and is the additional insurance cost worthwhile for you?
What exactly is collision auto insurance? 

What does collision insurance cover? If your car insurance policy includes collision coverage, it will help pay for the repair or replacement of your vehicle if it is damaged in a car accident. It is especially useful in at-fault accidents, where your liability coverage would only cover the other driver's and their passengers' expenses.

In general, the at-fault driver's property damage liability coverage contributes to the cost of repairs to the other party's vehicle. However, if you were not at fault for the accident, collision coverage may still be useful.

When another driver's negligence causes damage to your vehicle, your auto insurance may help repair it under collision coverage, protecting you from some out-of-pocket expenses while your insurance company seeks reimbursement from the at-fault driver's insurance company. This is useful when the driver's insurance company is slow to respond or when the at-fault driver does not have enough or any coverage. Uninsured and underinsured motorist coverage may apply in some cases, but not always.

What is covered by collision insurance?
In a nutshell, collision coverage is intended to protect your vehicle by assisting you in paying for repairs or replacement if it collides with another vehicle or object. Assume you collide with a curb and damage your tyres and bumper. In this case, you are to blame for the damage, and collision insurance kicks in. Collision insurance also covers repairs to your car, even if you were at fault in an accident. 

Aside from the two scenarios mentioned above, collision insurance covers damages caused by:
A collision with another vehicle
crashing into a tree, fence, or mailbox
Damage to your vehicle as a result of a collision with a road hazard, such as a sign post or guardrail

What isn't covered by collision insurance?
Collision insurance does not provide comprehensive coverage. Here are a few examples of what is not included: 

Theft or vandalism damage to your vehicle
Animal-related damage to your vehicle
Fire damage to your vehicle
Natural disaster or bad weather damage, such as hail
The aforementioned non-covered perils are covered by comprehensive insurance.

Do I require collision car insurance?
If you finance or lease your car, your lender will usually require you to have collision insurance until the loan is paid off or the leased vehicle is returned.
If you do not owe money on your car, consider how much it would cost to replace or repair it if it were damaged or totaled in an accident. If you do not believe you can afford to repair or replace your car after a collision, having collision coverage may provide you with peace of mind in the event of an unexpected situation. However, if your car is an older model or has significantly deteriorated, you may be better off foregoing the coverage.

How do I get collision insurance?
Most auto insurers offer collision coverage when you purchase a policy. When compared to liability-only insurance, collision coverage is advantageous because it provides financial protection against vehicle damage. Your collision coverage pays for repairs or replacement costs up to the actual cash value of your vehicle, which is the most your policy will pay for a covered claim. Collision coverage also has a deductible, which you would be responsible for if you filed a claim.

For example, if your car has $5,000 in collision damage and you have a $1,000 deductible, you will most likely receive a $4,000 payment from your insurance company to cover the repair costs. This does not imply that you must write a $1,000 check to your insurer. Instead, your insurer will usually deduct your deductible from the check it issues you.
When you purchase the coverage, you can choose your collision deductible amount as a policyholder. The higher your annual premium, the lower your deductible. Insurance experts generally advise choosing an amount that you are comfortable paying out-of-pocket in the event of an accident.

What is the distinction between collision and comprehensive coverage?
While collision coverage helps cover the costs of repairing your car after an accident, comprehensive coverage helps you repair or replace your vehicle if it is damaged in an event other than a collision, such as hail, flooding, or a falling object. It also applies if your car is stolen or vandalised.

Do older vehicles require collision insurance?
Aside from your state's required minimums, additional car insurance coverages are a personal choice as long as the vehicle is not financed or leased. To provide financial protection for their vehicles, some people choose full coverage, which includes collision and comprehensive coverage. Because older vehicles have depreciated in value, some drivers may find that collision coverage is not as beneficial due to the value of their vehicle and the potential cost of repair.

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