Collision coverage is a key part of an auto insurance policy that helps pay to repair or replace your vehicle if it’s damaged in a crash, regardless of who was at fault. Whether you’re involved in a fender-bender, hit a guardrail, or your car is damaged in a single-vehicle accident, collision coverage steps in to help cover the cost of repairs so you’re not left paying out-of-pocket.
What is collision insurance?
Collision insurance is coverage that helps pay to repair or replace your vehicle if it’s damaged in an accident, regardless of who caused it. If you hit another car, back into a pole, slide into a guardrail, or have a single-car accident, this is the coverage that helps fix your car. Liability coverage protects other people while collision protects your vehicle.
How does collision insurance work?
If your car is damaged in an accident, you file a claim with your insurance company. After the claim is reviewed, the carrier pays for the repairs minus your deductible.
Your deductible is the amount you agree to pay out of pocket before insurance steps in. For example, if your deductible is $1,000 and the damage is $5,000, you pay $1,000 and the insurance company pays the remaining $4,000.
If the vehicle is considered a total loss, the insurance company pays the actual cash value of the car, minus your deductible.
What does collision insurance cover?
Collision coverage typically helps pay for:
If your vehicle physically collides with something, collision coverage is what responds.
What does collision insurance not cover?
Collision coverage does not pay for:
Those situations fall under other parts of your policy, like liability or comprehensive coverage. This is why understanding how the pieces of your policy work together is important.
How much does collision insurance cost?
The cost of collision coverage depends on the year, make, and model of your vehicle, your driving history, where you live, and the deductible you choose.
Newer and more expensive vehicles usually cost more to insure because they cost more to repair. Choosing a higher deductible can lower your monthly premium, but it also means you’ll pay more out of pocket if you have a claim.
How do I get collision coverage?
Collision coverage can be added when you purchase or update your auto insurance policy. It’s optional in most states, but if you lease or finance your vehicle, your lender will likely require it.
When deciding whether to add collision coverage, consider whether you could comfortably afford to repair or replace your vehicle after an accident. If paying out of pocket would create financial strain, carrying collision coverage is typically a practical choice.
Collision coverage helps protect one of your most important assets, your vehicle, by reducing the financial burden after an accident. Having the right deductible and coverage in place ensures you’re prepared for the unexpected and aren’t stuck paying large repair bills on your own. If you’re unsure whether collision coverage is right for your vehicle or your budget, our team can review your policy and help you choose an option that fits your needs.