Here are Some of the Things You Need to Know About Collision Insurance
It's pretty straightforward what collision insurance coverage takes care of. While the law does not require a car owner like you to purchase one, adding it to your basic auto insurance policy can definitely work to your advantage - this is true even if you consider yourself as the most cautious and defensive driver on the face of the planet.
Simply put, collision insurance covers the repair your damaged car needs after a collision with another vehicle, whether you or the other party is the one who is at fault (more on this later).
The same is true if the physical damage to your vehicle was sustained after you crashed it into a tree, lamppost, fence or other hazards on the road. Collision insurance is nothing like comprehensive insurance in which the auto insurance company will only pay for your claim if the damage is due to things that you have no control over, such as a falling tree, hailstorm or vandalism.
Earlier, it was mentioned that collision insurance coverage will deal with the cost of repair if you crash your car into the vehicle of another individual. But what if the one accountable for the accident is the other person? Well, your collision insurance can work to your advantage if the one who is at fault doesn't have any or enough auto insurance to shoulder the damage costs. You can also make a claim if there is no uninsured/underinsured motorist property damage coverage added to your auto insurance policy.
So in other words, your collision insurance won't cover every single collision that may come your way.
Also mentioned earlier is the fact that no state in the US requires car owners to purchase collision insurance coverage. Needless to say, it is something that's completely optional. However, you may need to purchase it if your lender says so, or if you are financing or leasing a car.
Here's one important matter that everyone should know about collision insurance: just like a car, it tends to lose its value as time passes by. In fact, collision insurance may completely lose its worth most especially if you don't have a load or lease which requires its purchase. As a result of this, it's not unlikely for the cost of collision insurance coverage to amount less than what it would cost you to pay for repairs after an accident.
Definitely, you should give buying collision insurance coverage enough much-needed thought. Carefully weighing the pros and cons of adding it to your basic auto insurance policy is a definite must if it's your wallet's welfare that you are after. When making a decision, bear in mind your risk of encountering a mishap on the road.
Here are some FAQs on collision insurance:
Can I Purchase Collision Insurance Anytime I Want?
Yes, especially if you want to spare your wallet from ending up in a complete wreck should your car collide against another car of vice versa, it is a good idea for you to get your hands on collision insurance. However, it's important for you to know that it's something you can purchase only in conjunction with comprehensive and liability coverages.
Does Collision Insurance Coverage Have a Deductible?
The amount of money you have to pay before your coverage helps to shoulder your claim is referred to as a deductible, and a collision insurance coverage has a deductible. The amount of deductible you can choose can range anywhere from $0 to $1,000, depending on your auto insurance company.
Is There a Way to Lower the Cost of Collision Insurance?
Many car owners in the US are daunted by the steep cost of collision insurance coverage, and that's why they choose to not purchase it. If you're a budget-conscious individual, fret not because there is a way to have the monthly premiums lowered, and that is by means of choosing a higher deductible - typically $500 or greater.
Why is Collision Insurance So Expensive?
Some auto insurance coverages are simply harsher on the pocket than the rest. One of those that tend to cost a lot is collision insurance. It's because of the simple fact that a collision is more likely to happen than most other forms of accidents on the road. The good news is that it can save you from paying for steep accident damage out of pocket.
Potential Rate Discounts
If you qualify for discounts, you may save the amounts shown below.
|5-yr Accident Free||$81|
|5-yr Claim Free||$86|
|Paid in Full/EFT||$47|
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Discounts are estimated and may not be available from every company or in every state.