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Collision Insurance

Insurance which covers damage to a vehicle that results from a collision with another vehicle or object.

Part of owning or leasing a car is having the appropriate car insurance.  There are several coverage’s that you can get on your car, so it is important to understand them all in order to make informed choices.  One option for auto insurance is collision insurance.

Collision insurance pays for fixing your car if it is involved in a crash with an object or car.  When getting this insurance, you set a deductible amount for the repairs on your car.  That means that your collision insurance kicks in after the damages reach a predetermined amount.  Since the insurance company has to pay for the repairs if you have collision insurance, the company will go after the other insurance company involved if the collision is not your fault.  Your company does not want to pay out of its own pocket for something that was someone else’s fault.

Collision insurance differs from comprehensive insurance.  Comprehensive insurance covers damage to your car for incidents other than a collision.  For instance, if your car is stolen or vandalized, comprehensive insurance covers it.  If a flood or hail storm damages your car, it is the comprehensive insurance that pays for the repairs.  This insurance also has a deductible that must be met before the insurance company begins to pay for repairs.

When shopping for car insurance, keep a couple of things in mind.  First of all, find out what insurance is required by law in your state.  Obviously, that is the insurance that you absolutely have to get.  Second, consider the value of the car.  If it is a new car, you may want to go ahead and get as much coverage as you can for it.  If, however, it is an old clunker, decide if it is financially worth it to get collision or comprehensive coverage.  In that case, it may cost more to cover the car than it is worth.

Additional Resources

  • When to drop collision and comprehensive auto insurance