Physical Damage Coverage – Collision

Your collision coverage will protect you in case you have an accident involving another vehicle or object, or if you hit a pedestrian or cyclist. If your car is severely damaged, then collision insurance can also help by paying for the cost of towing, storing, or salvaging the car. If the costs of the repairs outweigh the Kelly Blue Book value of the car, then the insurance company will pay the value of the car, so that you can replace it. 

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What collision auto insurance doesn't cover

• Collision coverage helps repair damage to any vehicle in case you are at fault for the accident. If you have an accident where the other driver is found to be at fault, then your insurance may expect the other driver's insurance company to pay for any repairs to your car.
• Collision insurance also won't cover any medical bills for injuries associated with any accidents. Bodily injury coverage will provide for any injuries or medical costs.
• Collision coverage also won't help you is if the accident is caused by a mechanical failure of the car that occurs because you fail to maintain it properly. For example, if you do not have your car serviced for its routine oil change, and you have an accident as a result, then your insurance may choose not to cover the repairs because the incident could have been prevented.

When to buy collision coverage

If you lease your car or have an automobile loan, then your lender will probably require you to purchase collision insurance. As with comprehensive insurance, there aren't any state laws that require you to purchase collision coverage; however, the National Association of Insurance Commissioners found that 72% of drivers still choose to purchase collision coverage, even though it's optional.

If you are deciding whether to buy collision coverage, then you will want to consider the age and value of your car. Like comprehensive coverage, your collision insurance only protects you up to the value of your car. So if your car is old or in poor condition, the cost of the insurance coverage may outweigh the benefits you might receive in case of a collision.

After your car reaches around five years of age, you might save some money by dropping your collision coverage. However, if you do forego the collision coverage, you should be prepared to pay out-of-pocket for any accidental damages and repairs.

Collision coverage can be cheap! Request a quote here!

Sources
http://www.wisegeek.com/what-is-the-difference-between-collision-and-comprehensive-auto-insurance.htm
http://www.carinsurance.com/CoverageDefinitions.aspx
http://www.smartmoney.com/personal-finance/insurance/how-much-auto-insurance-do-you-need-10731/
http://www.lendingtree.com/smartborrower/glossary/c/collision-insurance/
http://www.kbb.com/
http://www.thenewstribune.com/business/v-lite/story/482082.html

**Auto Insurance Finder is not an insurance broker or carrier. Content on this site is for comparison and informational purposes only. The products and services listed on this site may not be available in all states.

Last Updated: November 10, 2009