Collision insurance provides coverage to your car and pays for the repairing or replacement expense if you hit another vehicle or object such as a tree or pole in an accident. In contrast to liability insurance, collision insurance is applicable if the accident is your fault. If a person has financed or leased the car, your lender company requires you to have collision insurance. If the vehicle is on a lease or once you pay all the instalments, it will be optional to have collision insurance included in your car insurance policy. The definition of collision insurance is simple, yet it can vary depending on the accident types.
What Does Collision Insurance Cover?
The collision insurance covers the cost of repairing or replacement of your car. Generally, collision insurance applies to the following situations:
- If the accident involves your car only, such as rolling over
- If your vehicle hits an object such as a phone pole or tree
- Suppose you are involved in an accident with another vehicle. For instance, a driver hits your car on the street or a traffic crash.
But every accident situation is different, and the coverage type may vary depending on the condition.
What Does Collision Insurance Not Cover?
The collision insurance provides coverage only for the damage to your car. It doesn’t cover:
- The damage to other vehicles in the accident
- The damage to the hit object
- For bodily injuries or medical bills
Does Collision Insurance Provide Coverage for Theft?
Collision insurance only covers your car-related damage to the accidents; it doesn’t involve harm to you because of driving, such as theft. The theft is part of the comprehensive coverage of car insurance.
Why Do I Need Collision Coverage?
You may consider yourself as a responsible driver, then why should you have collision insurance? It is not obligatory by state laws to have collision coverage; however, it is always smart to have one as you can’t control everything on the roads.
Consider you are involved in an accident because another car hit you. You have to pay thousands of dollars from your pocket for the damage to your vehicle. Do you want to risk paying such a hefty amount for the damage which you did not even cause?
Collision coverage helps you cover your investment damage if added with liability and comprehensive coverages. If your car is on a lease or you are still paying for your lender vehicle, you must have comprehensive and collision coverage. Make sure you discuss with your lender about the coverage requirements. New drivers, especially teens with no experience or are new to the road, must have collision coverage.
Do Rental Car Accidents Get Covered in Collision Insurance?
The collision insurance will provide coverage for the damage if you are involved in an accident with a rental car. But the rental car coverage varies from state to state. Make sure you discuss the rental insurance coverage with your rental car agent.
Is Vandalism Covered in Collision Coverage?
Vandalism doesn’t involve any of the situations mentioned above and is a deliberate act of destruction. Like theft, collision coverage does not cover vandalism. However, comprehensive insurance can cover vandalism.
What Are Deductibles in Collision Coverage?
The deductible is the amount an insured pays before the coverage starts paying for your claim. You can decide the amount for deductibles in collision coverage. The choice of the deductible amount depends on your insurance company. If you choose to have a higher deductible, your premium amount will decrease. The amount of repairing includes the deductibles you have to pay as a covered claim. Generally, the amount of deductible ranges from $250-$1000. The value of your car is an essential factor when determining the deductibles.
Does Collision Insurance Cover Hit-and-Run Accidents?
Whether collision insurance covers a hit-and-run accident depends on the situation. For instance, your collision insurance will cover the damages if another driver crashes your car when parked. Still, the coverage will not include bodily injuries due to the hit-and-run accident. Hence, collision coverage is a smart choice in the car insurance policy.