You need to be aware of what is happening around you when you are driving. You should be especially vigilant when you are involved in a car accident because a lot of things can go wrong.
Car accidents can happen at any time, and they can be very dangerous for both drivers involved. It’s essential to understand the different levels of car insurance coverage so that you know what kind of protection is available to you.
One type of coverage that you may have heard about is collision coverage. This type of car insurance helps to protect your vehicle in the event of a crash with a fixed object or another vehicle.
This article discusses everything you need to know about collision coverage. Read on to learn more.
What Is the Definition of Collision Insurance?
Collision coverage is a type of car insurance coverage that helps pay to repair or replace your car if it is damaged in a crash with a fixed object or another vehicle.
This type of coverage is optional in most states, but your lender may require it if you have a loan or lease on your vehicle.
Collision coverage can help pay for the following:
- The cost of repairs to your vehicle if it’s damaged in an accident
- The cost of a rental car while yours is being repaired
- The cost of a tow truck if your vehicle needs to be towed from the accident scene
How Does Collision Coverage Differ from Comprehensive Coverage?
While most people think that collision and comprehensive coverage are the same, they’re actually quite different.
Collision coverage only pays for damage to your vehicle caused by an accident with a stationary object or another vehicle. It does not cover any other type of damage.
It means that if your car is stolen or vandalized, you will not be able to file a claim with your collision coverage.
On the other hand, comprehensive coverage does cover damage to your vehicle that’s caused by non-accident-related events such as theft, vandalism, or weather damage.
Comprehensive insurance is also known as Other than Collision (OTC) insurance. Some auto insurance providers usually combine collision coverage and comprehensive insurance to form full auto insurance. A full coverage auto insurance policy will protect you from most types of accidents.
What Is and Is Not Covered by Collision Coverage
Collision coverage will pay for damage to your vehicle caused by an accident with another vehicle or a stationary object. It does not cover any other type of damage. This includes:
- Damage to your vehicle that’s caused by a non-accident-related event such as theft, vandalism, or weather damage
- Medical expenses for injuries sustained if you’re involved in an accident
- Damage done to your vehicle if you don’t have a valid license or registration
It will also not cover any damage done to your vehicle caused by racing, driving under the influence of drugs or alcohol, and other illegal activities.
If you’re involved in an accident with another driver who doesn’t have enough insurance or who is uninsured, your collision coverage may not pay for any damages to your vehicle if the other driver is at fault.
Do I Need Collision Coverage?
Whether or not you require a collision coverage policy depends on a few factors, including your driving habits and the value of your car. If you drive an older car worth less than $10,000, you may not need to purchase collision insurance because it wouldn’t make financial sense.
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However, if you have a newer car that’s worth more than $10,000, then collision insurance may be a good idea because it will help pay to repair or replace your vehicle if it’s damaged in an accident.
Another factor to consider is your driving habits. If you live in a high-crime area or a city with frequent car accidents, you may want to consider purchasing collision insurance for additional protection.
Ultimately, the decision is up to you, and it depends on your unique financial situation and driving habits. Talk to an insurance agent or broker near you to learn more about your options and which type of coverage is right for you.
What Is the Average Cost of Collision Coverage?
The cost of collision coverage usually varies depending on a number of factors, including the value of your vehicle, your driving history and habits, and where you live.
Generally speaking, drivers with newer cars or who drive in areas with high rates of car accidents may end up paying more for collision insurance than drivers with older vehicles or who live in low-crime areas.
You can usually pay anything from $1500 to $1800 per year for collision insurance coverage, though the exact amount will depend on your unique situation.
Talk to an insurance agent or broker in your area to find out more about how much you’ll pay for collision coverage. They can help you get a quote for coverage and answer any questions you have about the insurance process.
What Happens If I Don’t Purchase Collision Coverage?
If you don’t have collision coverage and are involved in an accident, you will be responsible for paying for any damages to your vehicle out of your own pocket.
This can be a significant financial burden, especially if you have a newer car or if another driver caused the accident.
If you can’t afford to pay for repairs out of pocket, you may want to consider financing your repairs or selling your car to cover the cost of the damages.
Either way, it’s important to remember that not having collision coverage can end up costing you a lot of money in the long run.
Seek Legal Help
Whether you have collision coverage or not, being involved in a car accident can be a stressful and confusing experience. If you’ve been in an accident, it’s essential to seek legal help as soon as possible.
An experienced car accident lawyer can review your insurance policy, help you understand your legal rights and options, and advise you on the best course of action to take.
If you’ve been involved in a car accident, contact a car accident lawyer today to learn more about your legal options and get started on the road to recovery.