Collision insurance is a cover that allows you to repair or replace your car if it has been damaged in an accident with another vehicle or an object such as a fence or a tree. When you rent or finance your car, the lender usually needs collision insurance. If your car is paid, a collision is optional coverage for your auto insurance.

WHAT DOES COLLISION INSURANCE COVER?

Collision insurance pays for the repair or replacement of your vehicle if it is damaged by:

• A collision with another vehicle.
• A collision with an object such as a fence or a tree.
• A car accident with rolling or falling

WHAT IS NOT COVERED BY COLLISION INSURANCE?

Collision insurance does not cover:

• Damage to your vehicle not related to driving ( hail or theft)
• Damage to someone else’s vehicle
• Medical bills (yours or someone else’s)

DEDUCTIBLES AND LIMITS OF COLLISION COVERAGE

Collision coverage has a deductible. This is the amount you pay before your coverage settles your claim. In general, you can choose the amount of your collision deduction when you buy coverage. Depending on your insurer, you can choose from several deductible amounts, generally $0, $500 or $1,000. Choosing a lower deductible may increase your premium. If you choose a higher deductible, your premium may also decrease. However, please note that you must pay your deductible for auto repairs out of your own pocket as part of a covered claim. If you choose a deductible of $1,000 and your car is subsequently damaged in an insured accident, you will have to pay $1,000 for the repair costs. Typical deductibles are generally between $250 and $1,000. However, the value of your car is an important factor to consider when determining your deductible. There is a limit for collision coverage. This is the maximum amount your policy pays for a covered claim. The collision protection limit is generally the actual cash value of your vehicle (its value less depreciation). For example, suppose your car is in a collision. Your insurer will issue you a check for the depreciation of the car less your deductible. Please note that “deficiency” means that you may not be able to replace your old vehicle with a newer make and model. You will probably have to use some of your own money to do this.

WHY BUY COLLISION COVERAGE?

If you owe or rent money for your car, collision coverage is generally not optional. Most lenders and tenants need it. However, if your car is paid for, you can purchase collision insurance. Note the following: How much would it cost to repair or replace your vehicle if it was damaged or destroyed in an accident? If you can’t afford to repair your car after an accident or buy a new one, you can calm down by purchasing collision insurance.